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PRIVILEGE AND 
 DEMOCRACY IN AMERICA 
 
BOOKS BY FREDERIC C. HOWE 
 
 Pdblished by CHARLES SCRIBNER'S SONS 
 
 Privilege and Democracy in America. 12mo 
 
 net, SI. 50 
 
 The Britisli City: The Beginning of De- 
 mocracy. 12mo . . . net, SI. 60 
 
 The City : The Hope of Democracy. 12mo 
 
 net, $1.50 
 
PRIVILEGE AND 
 DEMOCRACY IN AMERICA 
 
 BY 
 FREDERIC C. HOWE, Ph.D. 
 
 AUTHOR OF "the CITY : THE HOPE OF DEMOCRACT"; *'tHE BRITISH CITT : 
 THE BEGINNINGS OF DEMOCRACY," ETCb 
 
 NEW YORK 
 
 CHARLES SCRIBNER'S SONS 
 
 1910 
 
 ?. 
 
COPTBIGHT, 1910, BT 
 
 CHARLES SCRIBNER'S SONS 
 Published March, 1910 
 
TO 
 
 MY MOTHER 
 
PREFACE 
 
 Down to the beginning of the nineteenth century 
 government was merely the will of a class. Politics 
 mirrored the wish of the privileged orders. And the 
 motive which inspired the governing classes was 
 primarily an economic one. This interpretation of 
 politics has only begun to influence the writing of 
 history. Yet in this motive is to be found the cause 
 of wars and of peace, of intrigue and of diplomacy, 
 of force and of fraud, of practically all legislation 
 relating to religion, taxation, industry, and the rela- 
 tion of classes. The struggles of kings and parlia- 
 ments, of burghers and peasants, of cities and over- 
 lords had their origin in the desire to use the 
 agencies of government for the advantage of one or 
 the other of the contending orders. We have only 
 to study the ParUamentary struggle which has just 
 closed in Great Britain, to see a confirmation of 
 this fact. In this instance the conflict was carried 
 on by peaceful means. But the motive of the 
 struggle was the same. It was a warfare of classes, 
 organized through parties instead of with armed 
 retainers, but bent on the control of the govern- 
 ment for economic advantage. 
 
viii PREFACE 
 
 During these centuries religion was the hand- 
 maiden of the class which ruled. It aided in the 
 creation of a moral code which kept the masses of 
 the people in subjection, and contented with their 
 lot. It taught the paralyzing ethics of obedience, 
 of reverence, of humility, of duty. All of the rela- 
 tions of society were created by the class which 
 ruled. And the class which ruled was the class 
 which owned. Its constant aim was to control the 
 distribution of wealth. 
 
 When society emerged from the anarchy of the 
 Middle Ages, law was substituted for the reign of 
 force, which the ruling classes had employed in an 
 earlier age. And by means of law humanity was 
 made to obey. By law the feudal lord reared him- 
 self above the serf just as the patrician had reared 
 himself above the pleb. And through the aid of 
 religion, education, and the administration of justice, 
 law was given a solemn and religious sanction. 
 Through these agencies the economic framework of 
 society, as well as the relations of classes, was ad- 
 justed to suit the will of the ascendant class. 
 
 "The holders of riches always appropriate to 
 themselves political authority," says Achille Loria, 
 the eminent Italian economist. This "is common 
 to the various historical phases of capitalistic prop- 
 erty. It is the class that predominates economi- 
 cally that holds the political power in each historical 
 period. Thus in the Grseco-Italian world it was 
 
PREFACE ix 
 
 the slave-owning class, in the Middle Ages it was 
 the feudal lords, and at the present epoch it is the 
 bourgeois proprietors who are politically supreme."^ 
 
 To what extent has democracy shifted this 
 ascendancy? How far do the laws of America re- 
 flect the popular will and the economic relations of 
 men correspond to the new distribution of power? 
 Has the political revolution of the nineteenth cen- 
 tury carried with it a revolution in the economic 
 environment, which, in the last analysis, controls 
 the life, the liberty, the morals, and the well-being 
 of humanity ? For man's whole life is moulded by 
 his economic environment. And this is made by 
 law. Not by natural law, not by moral law, not 
 alone by the common law, but by the laws enacted 
 by Congress at Washington, by the legislatures of 
 our states, and by the councils in our cities. More 
 than anything else, statute law determines the well- 
 being of the people. More than anything else, it 
 controls the distribution of wealth. 
 
 In the past, at least, law has been the fountain 
 of servitude as well as of liberty, of injustice as well 
 as of justice, of poverty as well as prosperity, of 
 crime as well as of the punishment which it sought 
 to prevent. And many are asking to-day whether 
 conditions have really changed. Do not the few 
 still elevate themselves upon the backs of the 
 many by means of law, by means of the control of 
 
 ' The Economic Foundations of Society, p. 28. 
 
X PREFACE 
 
 government and the agencies of justice and public 
 opinion ? Is there not truth in the suggestion that 
 society itself is responsible for the wreckage which 
 industry has cast upon our shores? Are not pov- 
 erty and the attendant evils of ignorance, disease, 
 vice, and crime the children of our own flesh and 
 blood? Have not the liberties, which represent 
 centuries of sacrifice and suffering, only conferred 
 upon humanity the shadow of power, while the sub- 
 stance is still in the hands of an ascendant class, 
 which has made use of the new machinery as readily 
 as it did the old ? These are questions which under- 
 lie all others in the unrest which is expressing itself 
 in city, state, and nation. These are the questions 
 which are challenging authority in every country 
 in the world. And it is these questions that this 
 
 book aims to consider. 
 
 Frederic C. Howe. 
 
 Cleveland, Ohio, January, 1910. 
 
CONTENTS 
 
 CHAPTER PAGE 
 
 I. The Luke op the Land 3 
 
 II. The Economic Foundations op Democracy . . 18 
 
 III. The Rape op the Nation 28 
 
 IV. The Strangle Hold op Monopoly 45 
 
 V. The Tools op Privilege 58 
 
 VI. The New Serfdom 71 
 
 VII. Some op the Costs op Tenancy 83 
 
 VIII. The Evolution op Serpdom 94 
 
 IX. The Tyranny op the Dead 106 
 
 X. The Servitude op To-morrow 113 
 
 XL The Unearned Increment 122 
 
 XII. A Feudal Survival 138 
 
 XIII. "From Him That Hath Not Shall Be Taken 
 
 Away Even That Which He Hath "... 148 
 
 XIV. Some op the Costs op Land Monopoly. . . . 160 
 XV. The Future op Labor 173 
 
 XVI. The Distribution of Weaivth 185 
 
 XVII. The Ascendancy op Privilege 202 
 
 XVIII. An Overlooked Cause op Poverty 215 
 
 XIX. The Cause op Civilization and Decay .... 231 
 
 XX. The Economic Foundations op Morals . . . 243 
 
 XXI. The Remedy Proposed 255 
 
 XXII. The Remedy Considered 264 
 
xii CONTENTS 
 
 CHAPTER PAGE 
 
 XXIII. The New Dispensation 276 
 
 XXIV. The Open Door and the Open Highway . . . 287 
 XXV. The Democracy of To-morrow 294 
 
 Appendix I 303 
 
 Appendix II 306 
 
 Index 311 
 
PRIVILEGE AND DEMOCRACY 
 IN AMERICA 
 
CHAPTER I 
 THE LURE OF THE LAND 
 
 In the development of America may be seen the 
 development of Western civilization. Here as else- 
 where evolution has followed a sequence as orderly 
 as it was inevitable. All Europe as well as all 
 America has been fashioned by the same economic 
 influences and the political, social, and industrial 
 problems of the present day all trace their origins 
 back to beginnings in very early times, while the 
 long migration of peoples, which has finally reached 
 an impassable barrier by the western seas, is but 
 the continuation of a movement which has been in 
 progress since long before the Christian era. As the 
 eminent Italian economist, Achille Loria, says: 
 "America has the key to the historical enigma which 
 Europe has sought for centuries in vain, and the 
 land which has no history reveals luminously the 
 course of universal history." 
 
 This is most obvious in the migrations of peoples, 
 migrations which are not confined to those of the 
 barbarian hordes, which swept over the face of Eu- 
 rope in the centuries which followed the dismember- 
 ment of the Roman Empire. For the population of 
 the world hag been in migration from the beginnings 
 
 3 
 
4 PRIVILEGE AND DEMOCRACY 
 
 of recorded history, and so far as Western civiliza- 
 tion is concerned the movement has always been 
 away from the east. The centre of civilization 
 shifted from the rivers of Mesopotamia to Egypt 
 and Palestine. Thence it passed on into Greece, 
 where in the fifth and fourth centuries B. C. it gave 
 birth to a philosophy, literature, and art that have 
 remained the inspiration of subsequent centuries. 
 Colonies were settled all about the shores of the 
 Mediterranean Sea. Then, as now, men were lured 
 from their ancestral homes by the dreams of new 
 countries where opportunity still was free. Among 
 the colonies so founded was Rome. From the seven 
 hills upon the river Tiber the settlement expanded 
 into a nation, just as, many centuries later, the settle- 
 ments in Massachusetts and Virginia were the seeds 
 of a new people. Roman arms carried the Roman 
 eagles over the entire peninsula of Italy. In time 
 all Spain, Germany, Africa, and the East acknowl- 
 edged the dominion of the Republic. 
 
 During the first few centuries of the Republic 
 conditions of life were simple in the extreme. The 
 amount of land which the individual could own was 
 limited to what he could cultivate. Substantial 
 equality was thus secured to all. Upon each farm 
 was a citizen soldier who fought for his home and his 
 household gods. Conditions were not dissimilar to 
 those which characterized the first two centuries of 
 the American colonies. 
 
THE LURE OF THE LAND 5 
 
 With the expansion of the city of Rome into a 
 nation the government became more complex. 
 PoHtical control passed into the hands of an economic 
 class. It finally centred in the Senate, which repre- 
 sented the moneyed, landed, and creditor class. Im- 
 mense areas of land were added to the republic by 
 conquest. This land belonged by law to all the 
 people. It was the ager puhlicus, the folk land of the 
 nation. It was not unlike the Northwest Territory 
 acquired from Great Britain by the American colo- 
 nies. But the members of the aristocracy in control 
 of the government leased this land to themselves at 
 nominal rentals instead of allotting it among the 
 people to whom it belonged. They divided it into 
 great plantation estates, which were used for grazing 
 or were worked by slave labor. As time went on 
 the land was needed for settlement. Population in- 
 creased and the legions desired a home for them- 
 selves and their children, just as did the American 
 colonists after the war with France. But the mem- 
 bers of the aristocracy refused to relinquish the land 
 which they had illegally enclosed. They resisted 
 every effort to have the land allotted. They even 
 abolished the nominal rentals which they had agreed 
 to pay the state and assumed the right of absolute 
 private ownership instead. 
 
 By these means the aristocracy of Rome acquired 
 possession of nearly all Italy. The free citizens, 
 who had been the nation's strength, were driven to 
 
6 PRIVILEGE AND DEMOCRACY 
 
 the city or reduced to slavery by the cruel laws of 
 debt which the senatorial class had enacted. Here- 
 in was the beginning of national decay. It seems to 
 have been fearfully rapid in its extension. Accord- 
 ing to Marcus Philippus "there were not two thousand 
 individuals in the commonwealth who were worth 
 any property" by the second century B. C. When 
 Tiberius Gracchus passed through Tuscany to Nu- 
 mancia he "found the country almost depopulated, 
 there being hardly any free husbandmen or shepherds, 
 but for the most part only barbarians, imported 
 slaves." * It was this change, says Mommsen, 
 "which tended most directly to accomplish the ma- 
 terial and moral annihilation of the middle classes." ^ 
 The Roman historian Pliny has testified that "the 
 great estates have ruined Italy." 
 
 The small farmer was ruined by debt and tax- 
 ation. He was unable to compete with slave labor. 
 He was driven to the city or to foreign lands by 
 the monopoly of the land. By this process Italy 
 was almost denuded of free citizens at a time 
 when Roman arms had conquered the world. The 
 Roman freeman was driven from his native soil by 
 the patrician class who had acquired possession of 
 the land of his fathers. It was this that drove 
 him into Gaul, into Spain, into Germany, even into 
 distant Britain. 
 
 ' Plutarch's Lives, Tiberius Gracchus. 
 ' History of Rome, Vol. I, p. 347. 
 
THE LURE OF THE LAND 7 
 
 It was this that peopled Europe with Roman 
 colonists. In time all Europe became crowded, just 
 as Greece and Italy had been many centuries earlier. 
 As population increased, so did the demand for land. 
 It came to have a monopoly value. So long as the 
 land was held by feudal tenure, with the fixed and 
 customary services which feudalism involved, the 
 worker was secure in his holding. He could not be 
 dispossessed by the overlord. Neither his rent nor 
 his services could be increased. The interest of the 
 tenant was the same as that of the lord. They were 
 joint owners of the land.* But just as the Roman 
 freeman was driven from Italy by the creation of the 
 latifundia or plantation estates, so the freemen of 
 Europe were reduced to poverty by the substitution 
 of money rents for feudal services. Through this 
 change the overlord became the absolute owner of 
 the land. All Europe was divided into private 
 estates, worked by serfs subject to competitive rents. 
 It was this that led to the settlement of America 
 just as it led to the settlement of Europe at an earlier 
 day. 
 
 For many centuries the people of England were a 
 nation of home-owners. A part of the land was in 
 individual holdings. A much larger part was held in 
 common by the village. This was modified by the 
 Norman Conquest. The land of England was dis- 
 tributed by the Conqueror among his followers. It 
 
 ' See chapters VIII and IX. 
 
8 PRIVILEGE AND DEMOCRACY 
 
 was divided into great estates. The great barons 
 in turn divided it among their vassals. King, lord, 
 vassal, and serf were united by mutual services and 
 mutual obligations. The nexus of all relations was 
 the land. There was little money and no standing 
 army. The state was supported by military and 
 personal services which took the place of rent and 
 taxes. Land was the source of all political and 
 social power. This was the feudal state which ex- 
 isted all over the face of Europe during the middle 
 ages. 
 
 The feudal relationship began to disintegrate dur- 
 ing the thirteenth and fourteenth centuries. The 
 Black Plague of the fourteenth century hastened 
 it. It reduced the population of England by one- 
 third.' The position of classes was changed. So- 
 ciety was revolutionized. The labor supply was so 
 reduced that the villeins abandoned their feudal 
 holdings in order to accept something better. They 
 gave up the land which was theirs by right and under 
 a fixed rent, in order to be wage-earners or leasehold- 
 tenants. Instead of rendering personal services, they 
 now began to pay money rent. Herein was the be- 
 ginning of the break-up of the old relationship which 
 insured to the tenant a permanent position and at a 
 rent fixed in perpetuity. Through it the mass of the 
 people lost their hold on the land. They became 
 competitive tenants instead of joint owners under 
 
 ' Six Centuries of Work and Wages, Thorold Rogers, p. 223. 
 
THE LURE OF THE LAND 9 
 
 customary rent. This has profoundly influenced 
 Great Britain. It explains the degraded and im- 
 poverished condition of her agricultural population, 
 which, unlike that of many of the farmers of Europe, 
 is but little better than the condition of the casual 
 worker in the towns.' 
 
 For some centuries after the Black Plague rents 
 continued low. Land was cheap because labor was 
 dear. In the fifteenth century land began to rise in 
 value. The Spanish conquest of South America 
 flooded England with gold and silver. This facili- 
 tated the change from feudal services to money rents. 
 During the reign of Henry VII the landed aristocracy 
 began to enclose the common lands which comprised 
 
 ' The early feudal relationship of lord and vassal, in which the 
 rent of the tenant is fixed and constant, still persists, with some 
 modifications, in certain portions of Europe where custom or tra- 
 dition has prevented the overlord from assuming the right of abso- 
 lute ownership in the land. The old relationship is still to be found 
 in parts of Italy, France, and Holland. It also exists in the old 
 French manors on the lower St. Lawrence in Canada, where the 
 farmers still pay a small quit-rent to the seigneurs. Under these 
 tenures the rent remains unchanged from year to year, no matter 
 what the value of the land may be. Speaking of conditions in a 
 particularly favored region of Holland, Mr. Broderick says: " M. de 
 Laveleye's ideal of agricultural felicity in Holland is to be foimd in 
 the province of Groningen, where much of the land is cultivated 
 under a species of hereditary lease, known as Beklem-regt, at a 
 moderate and invariable rent. This system, he (i. e., Laveleye) 
 says, derived from the middle ages, created a class of semi-proprie- 
 tors, independent, proud, simple, but withal eager for enlightenment, 
 appreciating the advantages of education, practicing husbandry not 
 by blind routine and as a mean occupation, but as a noble profes- 
 sion by which they may acquire wealth, influence, and the consid- 
 eration of their fellowmen." Cobden Club Essays, Systems of Land 
 Tenure in Various Countries, p. 133. 
 
10 PRIVILEGE AND DEMOCRACY 
 
 a great part of the area of the nation. There "com- 
 menced a struggle of the most fearful character. The 
 nobles cleared their lands, pulled down the houses, 
 and displaced the people. Vagrancy on a most un- 
 paralleled scale took place. " '■ Henry VIII seques- 
 trated the lands of the monasteries, which amounted 
 to one-fourth of the area of the kingdom. He 
 turned their holdings over to favorites who con- 
 verted them into sheep preserves or raised the rents. 
 This still further increased the poverty of the coun- 
 try and the extent of vagabondage. 
 
 The remonstrances of the yeomen and the peasants 
 to Parliament were all to the same effect. They 
 said (1542) of the new landlords: "They cannot be 
 content to let them [the lands] at the old price, but 
 raise them up daily, even to the clouds, so that the 
 poor man that laboreth and toileth upon it is not 
 able to live. " 
 
 The enhancing of rents, and the enclosing of the 
 land by monopoHsts, was freely denounced as 
 destroying the commonwealth. The famous sermon 
 of Bishop Latimer before the king in 1549 voiced 
 the protest of the people. "You landlords, you 
 rent raisers, I may say, you step lords, you unnatural 
 lords, you have already too much. " For that which 
 before "went for £20 or £40 by the year (which is 
 an honest portion to be had gratis in one lordship of 
 another man's sweat and labor), now it is let for £50 
 
 ' History of Landholding in England, Fisher, p. 54. 
 
THE LURE OF THE LAND 11 
 
 or £100 by year," so unreasonably are things en- 
 hanced. "For whereas have been a great many of 
 householders and inhabitants, there is now but a 
 shepherd and his dog. " 
 
 By the end of the sixteenth century the bulk of 
 the land of England had passed from the people into 
 great holdings. The new landowners did not want 
 small tenants; it was more profitable to raise sheep. 
 Farmers were driven from their holdings. Vaga- 
 bondage increased with frightful rapidity. There is 
 a tradition that 72,000 persons were hanged for this 
 offence during two years of Henry VIII's reign. 
 During the sixteenth century the peasants revolted. 
 Land monopoly was the cause of these peasant 
 risings. The remonstrances of the poor who had 
 been driven off their lands by the processes described 
 were met with massacre. From this time on pov- 
 erty became more and more unmanageable and mis- 
 ery more universal. Hanging having proved im- 
 practicable, the Poor Laws of Elizabeth were enacted. 
 Wages were fixed by law. Then followed the en- 
 closure acts. The first was early in the eighteenth 
 century. They continued into the nineteenth. Be- 
 tween 1709 and 1820, 3,387,883 acres of the people's 
 lands were enclosed by the landowners in control of 
 Parliament. This still further impoverished the 
 agricultural population which was dependent upon 
 the commons for pasturage and fuel. Despite the 
 poverty and vagabondage, population increased very 
 
12 PRIVILEGE AND DEMOCRACY 
 
 rapidly. According to Thorold Rogers, the popula- 
 tion of England doubled during the seventeenth cen- 
 tury.* This increased still further the competition 
 for the land. Rents rose in consequence, while the 
 enclosure of the common lands and the use of the 
 land for sheep-raising diminished the supply availa- 
 ble for cultivation. It was by these processes that 
 the land of England was monopolized. It was this 
 that destroyed the yeomen. It was this that im- 
 poverished England. 
 
 It was this that led to the settlement of America. 
 Land monopoly drove the Puritan from England in 
 the seventeenth century just as land monopoly drove 
 the Catholic from Ireland two centuries later. The 
 emigration of the present day confirms this. It is 
 only the dispossessed who come. And they come 
 almost exclusively from those countries where land 
 monopoly and competitive rents remain the least 
 impaired. Wherever peasant proprietorship is the 
 rule the population remains at home. 
 
 Switzerland, Holland, Denmark, and France are 
 countries of the small proprietor. These countries 
 have added little to our population. It is England, 
 Ireland, Scotland, Germany, and Austria, and now 
 Russia, Italy, and the Baltic provinces, where the 
 land is still held in great estates, that have sent their 
 landless peasants over the face of the earth in search 
 of a new chance, free from the servitude which land 
 
 'Six Centuries of Work and Wages, p. 463. 
 
THE LURE OF THE LAND 13 
 
 monopoly everywhere involves. It is rarely the well- 
 to-do, rarely the home-owner, rarely, even, the tenant 
 with an interest in the soil who migrates. Men care 
 but little about the form of government under which 
 they live as long as they are industrially free. 
 Neither political nor religious persecution dislodges 
 the property-owning class. So strong is the tie of 
 property, of even a little property, that men suffer 
 every sort of oppression rather than abandon their 
 native homes. It is poverty that drives men to dare 
 the unknown. It is land monopoly that has sent the 
 English colonist to every quarter of the globe. It is 
 this that explains the expansion of Russia into Siberia, 
 of Japan into Korea, and of all Europe into America. 
 To satisfy one's desires with the minimum of effort 
 is an elemental law to which all nature responds. It 
 is the moving force of all life. All nature follows 
 the line of least resistance. The dumb animals of 
 the forest are blindly guided by this principle which 
 nature has implanted in all animate beings. Life is 
 inconceivable with this motive absent. It underlies 
 every activity; it explains every movement of life. 
 It lies at the bottom of all psychology, as well as of 
 all political economy. To satisfy one's wants in the 
 easiest possible way is as fundamental to biological 
 and social science as the law of gravitation is to 
 physics or the heliocentric theory is to astronomy. 
 In response to this instinct, nations, tribes, and in- 
 dividuals have abandoned ancestral homes to build 
 
14 PRIVILEGE AND DEMOCRACY 
 
 their fortunes anew in unknown lands. Inspired by 
 this motive, men have crossed the seas and pene- 
 trated into the untouched wilderness — ^they have 
 braved the Arctic Circle and the jungles of the tropics. 
 For this they have pushed their way into the forests 
 and prairies of the distant West. It was the desire 
 for economic freedom, for the satisfaction of their 
 material wants with a minimum of effort, that lured 
 the Argonauts around Cape Horn and across the 
 deserts during the gold fever of 1849, just as it lured 
 them into the heart of the Yukon during the closing 
 years of the last century. 
 
 Free land has been the call to which this blind 
 instinct of man has been attuned. It has been the 
 controlling motive of our life. For three centuries 
 the descendants of the early settlers, together with 
 the incoming immigrants, have responded to this call. 
 The frontier was pushed back along the rivers and 
 over the Alleghany Mountains like a great glacial 
 moraine. It spread out into the north-west territory. 
 Thousands of soldiers were settled by the govern- 
 ment. In the closing years of the eighteenth century 
 land companies opened up Ohio, Indiana, Kentucky, 
 and Tennessee. New states were carved out of this 
 territory. Long before the Civil War the settler found 
 his way beyond the Mississippi River, inspired as were 
 his father and his father's father, by the desire for 
 opportunity, an opportunity that was offered by the 
 free land upon the frontier. 
 
THE LURE OF THE LAND 15 
 
 This movement continued at an accelerated pace 
 during the generation which followed the Civil War, 
 These were years of phenomenal railway develop- 
 ment. During the five years to September, 1873, 
 $1,700,000,000 was expended in railway building. 
 36,000 miles of line were constructed, more than had 
 been laid in the preceding generation. Much of this 
 development was to the west of the Mississippi. 
 Since that time railway construction has continued, 
 until to-day the total mileage is in excess of 224,000. 
 This is equivalent to an eight-track railway com- 
 pletely encircling the globe. During this period set- 
 tlement followed the railways, just as formerly it 
 had crept up the rivers, or followed the great lakes or 
 wagon routes. A free homestead of 160 acres 
 was a mirage of hope. It was the voice of oppor- 
 tunity calling to the pioneer. It depopulated Ire- 
 land. It brought to our shores the most adventu- 
 rous spirits of Europe. It converted the hills of New 
 England into a region of deserted farms. More re- 
 cently it has lured the college men of the East to the 
 prairie states and mining camps. The frontier has 
 been pushed on and still further on. Population has 
 crossed the broad arid belt which, up to a few years 
 ago, was known as "the Great American Desert." 
 It reached and crossed the Rocky Mountains, in the 
 face of the declaration of Thomas Benton that at 
 these mountains "the western limits of the Republic 
 should be drawn, and the statue of the fabled god. 
 
16 PRIVILEGE AND DEMOCRACY 
 
 Terminus, should be raised to the highest peak, never 
 to be thrown down. " 
 
 America has repeated the history of other nations. 
 The desire to be free, to satisfy one's desires with the 
 minimum of effort, has filled in the open spaces of 
 America and is now spilling our surplus population 
 over into Canada and Mexico. 
 
 At last the waves of population have broken on the 
 Pacific slope. But that the hunger for land is as 
 intense as ever is demonstrated whenever an Indian 
 reservation is opened up to settlement. Upon the 
 borders of these reservations, tens of thousands of 
 persons gather, impatiently awaiting the signal to 
 enter and take possession of the promised land. 
 Like an avalanche they pour in upon the opened ter- 
 ritory, conscious that the few remaining acres of our 
 once apparently inexhaustible domain are being 
 fenced in forever. 
 
 The West is now enclosed. The world-long drift 
 of peoples has finally come to an end. It has reached 
 an impassable barrier in the Pacific Ocean. The 
 free land of the nation has been taken up. There is 
 now no homestead to be had for the asking. The 
 frontier has only a historical significance. The 
 public domain is almost wholly gone. "The pubhc 
 lands which now remain are chiefly arid in character," 
 says the Public Land Commission.' The oppor- 
 tunity for a home, which for three centuries has been 
 
 ' Senate Document No. 188, 58th Congress, 3d session, p. 3. 
 
THE LURE OF THE LAND 17 
 
 open to all, has been finally closed by occupancy or 
 fraudulently appropriated by individuals and cor- 
 porations in collusion with the government. No 
 longer is America the commons of the world. The 
 steady stream of home-seekers which for three cent- 
 uries drifted across the face of the continent, has 
 ceased to pass our doors. 
 
 This enclosure of the American West, for three 
 centuries the ager publicus of the world, terminated 
 the greatest single movement of modern history. 
 It marks the close of the first real cycle of American 
 life, a cycle which has been repeating itself, at various 
 epochs in the history of the world, from the dawn 
 of Western civiUzation. In a big perspective, it may 
 be likened to the fall of Rome, the opening up of a 
 new route to India by Vasco da Gama, or the dis- 
 covery of America by Columbus. In so far as it 
 affects America, it marks the end of an era. In so 
 far as it brings to an end twenty centuries of west- 
 ward migration, it is revolutionary. It marks a 
 turning-point in the world. 
 
CHAPTER II 
 
 THE ECONOMIC FOUNDATIONS OF 
 DEMOCRACY 
 
 One need not accept the materialistic conception 
 of history to find in the free public lands of America 
 the greatest single influence in our life. Under- 
 neath the surface the great movements of democracy 
 — political, social, industrial — have been moulded 
 by the free land and the sense of freedom which it 
 awakened in all. To this call every instinct of 
 democracy has been attuned. This has been true 
 from the very beginning. 
 
 It is economic liberty that has moulded our politi- 
 cal institutions. It is the free public lands of the West 
 that have made us free. It was this that inspired 
 the Declaration of Independence, it was this that 
 led to the separation of the colonies from England, it 
 is this that has ever vitalized American democracy. 
 We have been taught that the Revolution was a pro- 
 test of Englishmen against an invasion of the rights 
 secured by Magna Charta; that the interference of 
 Parliament with the colonist aroused the Anglo- 
 Saxon in his new home to a spirit of revolt. All 
 these things were irritating, it is true, but the sense 
 of security of the colonists was menaced in a far 
 
 18 
 
THE FOUNDATIONS OF DEMOCRACY 19 
 
 graver way. According to a recent historian, it was 
 a proclamation of George III that the "hinterland" 
 to the west of the Alleghany Mountains should 
 be closed to further settlement that aroused the 
 colonies to resistance.' The settler had always 
 looked upon the West as part of his possessions, 
 secured to him by grants of the Crown and confirmed 
 by his own sacrifice and suffering. Long before the 
 French and Indian War he had come in conflict 
 with the French over the region to the west of the 
 mountains, and New England, as well as Virginia, 
 had joined with the mother country to drive a tra- 
 ditional foe from the menacing position which it oc- 
 cupied in the rear. The American looked upon the 
 continent as his own and, upon the close of the war 
 with France, he expected to be confirmed in his 
 original grants. Instead of this George III issued an 
 order forbidding the colonists to purchase land from 
 the Indians, or to make any settlements in the re- 
 gions acquired from France. The British Board of 
 Trade enforced this order. It refused its consent 
 to petitions for land. By this order the colonist was 
 limited to the seaboard, his dreams of economic inde- 
 pendence were destroyed. And it was to preserve 
 this opportunity to himself and his children that he 
 took up arms against the mother country. 
 
 And just as this instinct for freedom and the desire 
 for Western lands led to war with Great Britain, so 
 
 ' Foundcttion? of Modern Europe, Emil Reich, p. 9. 
 
20 PRIVILEGE AND DEMOCRACY 
 
 the fruits of the war later preserved the Union. The 
 territory to the west of the Alleghanies became the 
 property of the Colonies by conquest. The title was 
 in dispute. The conflicting claims of the states were 
 finally settled by the abandonment of the north-west 
 territory to the Federal Government.' It became 
 the property of the nation. The states that were 
 born thereafter were children of the Union. They 
 claimed no traditions of state sovereignty, they had 
 no memories of independence. This great territory 
 was a bond of nationality, which held the states 
 together in the years which followed. It was an 
 ager publicus, the folk-land of all the people. It 
 cemented the nation. It gave the people a common 
 interest and a common purse. 
 
 Just as the public lands formed the strongest bond 
 of nationality in the years when the sense of union 
 was forming, so the same public lands were the pri- 
 mary cause of the attempted dissolution of the Union. 
 The expansion of the West threatened the institution 
 of slavery. The new states carved out of the prairies 
 disturbed the balance of power which had thereto- 
 
 '"The territory embraced within the present states of Ohio, In- 
 diana, Illinois, Michigan, Wisconsin, and Tennessee, that part of 
 Minnesota lying east of the Mississippi River, and all of Alabama 
 and Mississippi lying north of the thirty-first parallel was held by 
 Massachusetts, Connecticut, New York, Virginia, North Carolina, 
 South Carolina, and Georgia under grants from Great Britain during 
 their colonialcondition. These territorial interests were surrendered 
 to the general government of the Union by the last named states 
 . . . and constituted the nucleus of our public domain." The Pvh- 
 lic Domain, Donaldson, p. 10. 
 
THE FOUNDATIONS OF DEMOCRACY 21 
 
 fore existed. The dominion of the slave states in 
 Congress was jeopardized. This was especially true 
 in the Senate. There the commonwealths enjoyed 
 equal representation. Even the most solemn sanc- 
 tions of the Constitution could not prevent a conflict 
 between the divergent economic systems of the North 
 and the South. Thus it was that the public land 
 united the nation at a time when it most needed 
 cohesion, and at a later date threatened the dis- 
 memberment of that which it had so largely con- 
 tributed to save. 
 
 The West is the real birthplace of American de- 
 mocracy. The seaboard states have ever been 
 aristocratic in thought and interest. The frontier 
 jealousy resented any interference from a distance. 
 And the states carved out of the West have impressed 
 their influence on politics, industry, education, and 
 character. They came into the Union with full man- 
 hood suffrage. They exulted in their freedom, and 
 their note has ever been one of protest, of independ- 
 ence, of liberty. The West has constantly drawn to 
 itself the restless forces of discontent. Men crushed 
 by competition it has called. Men eager for personal 
 freedom it has invited. In this sense the West has 
 been the escape-valve of America. The buoyancy of 
 our character is traceable to the free democracy which 
 was founded on a freehold inheritance of land. 
 
 Our politics have been quickened by this sense of 
 economic liberty. The attitude of the West has been 
 
22 PRIVILEGE AND DEMOCRACY 
 
 that of the pathfinder. It is pioneer-like and feels 
 that the present owes no obligations to the past. 
 Education is highly cherished. The state univer- 
 sities are close to the people. The public has an 
 affectionate regard for higher learning and utilizes 
 its institutions in many ways for the promotion of 
 local matters. Here, the girl looks forward to higher 
 education just as does the boy, and both attend col- 
 lege together. In Colorado, Wyoming, Utah, and 
 Idaho suffrage has been extended to women, while in 
 North Dakota, South Dakota, Oregon, Oklahoma, 
 Missouri, and Montana democracy has popularized 
 all legislation through the initiative and referendum. 
 The free public lands have moulded industry no 
 less than politics. Free land has determined the 
 scale of wages as well as the opportunity for em- 
 ployment. No man will remain in another's employ 
 for less wages than he can earn on his own home- 
 stead. And in all new countries the wages which 
 prevail are determined by what can be produced on 
 the land itself. During colonial days, the indented 
 servant was found along the seaboard. But no in- 
 denture of personal servitude crossed the Alleghany 
 Mountains. There can be no servitude, save that 
 of chattel slavery, where free lands are to be had 
 by the worker. The redemptioner and the tenant 
 speedily became home-owners, for free land was 
 always to be had just beyond the line of settlement. 
 Here was independence, and the hope that was born 
 
THE FOUNDATIONS OF DEMOCRACY 23 
 
 of independence. Here was freedom from the servi- 
 tude of the master and the landlord. Here a new- 
 life, under new conditions, was open to all. It is this 
 that explains the high standard of living that has 
 prevailed in America. It is not due to the protective 
 tariff, it is due to the fact that the wage-earner could 
 adopt another alternative, and an alternative that 
 left him a free man. It is this that has determined 
 wages in America. It is this that explains the gen- 
 eral well-being which prevails in all new countries. 
 
 "While free lands exist," says Achille Loria, the 
 celebrated Italian economist, "that can be cultivated 
 by labor alone, and when a man without capital may, 
 if he choose, establish himself upon an unoccupied 
 area, capitalistic property is out of the question: as 
 no laborer is disposed to work for a capitalist when 
 he can labor on his own account upon land that 
 costs him nothing. Evidently, therefore, while such 
 conditions prevail, the laborers will simply take pos- 
 session of the free lands and apply their labor to the 
 soil, adding to this the capital they accumulate. '" 
 
 This is what occurred in America. It was free 
 land that raised the American wage-earner above the 
 laborer of Europe. It was the amount produced 
 upon the free land that determined wages. This con- 
 trolled wages in all other industries. It was this 
 that raised our workers to industrial efficiency. It 
 was this hope that has made them resourceful. Up 
 
 ■ Economic Foundations of Society, p. 2. 
 
24 PRIVILEGE AND DEMOCRACY 
 
 to very recently the wage-earner always dreamed of 
 a larger success. The free land of the West is also 
 responsible for America's industrial eminence. It 
 is the coal and the iron, the copper and the oil, the 
 wheat, corn and cotton fields of the West and South 
 that have given us supremacy. It is not protec- 
 tion, it is freedom of trade between our states and 
 freedom of access to the resources of the earth that 
 awakened industry. It was a free field open to all 
 that developed our powers. It built our railroads, 
 telegraphs, and telephones; it girded the earth with 
 steamships and revolutionized all industry. It 
 placed the wheat-fields of the Dakotas alongside of 
 the mills and factories of old England. It built our 
 cities; it gave diversity, strength, and independence 
 to life and character. 
 
 The generation which closed with the century 
 was one of intense competition and splendid achieve- 
 ment. It was a generation devoted to harnessing 
 nature to the service of man. It brought forward 
 the captains of industry. They were men familiar 
 with every process from the bench to the counting- 
 room. Human talent enjoyed an opportunity un- 
 paralleled in the history of the world. Democracy 
 at work on the undeveloped resources of the country 
 produced an array of men, masters of their craft and 
 leaders in their respective communities. 
 
 There is no more conclusive demonstration of the 
 economic basis of all life, of all progress, of all civil- 
 
THE FOUNDATIONS OF DEMOCRACY 25 
 
 ization, in fact, than the history of the development 
 of America. It was not poUtical, it was economic 
 Uberty that made America what she is. It mat- 
 tered not from what section of the earth men came 
 or what their previous environment had been, those 
 of force pushed their way to the fore and grew strong 
 by contact with obstacles in a way that suggests 
 the achievements of Drake and Hawkins, whose 
 daring exploits opened the way for the expansion 
 of England over distant seas. It was economic 
 opportunity that made the American people what 
 they are. It was our unparalleled resources that 
 gave us a position of industrial supremacy. The 
 leaders of the age came up from the sod and the mill. 
 They did so, not because they were politically free, 
 but because they were industrially free. 
 
 That which is true of America is true of the world. 
 In the last analysis the institutions of a people are 
 but the reflection of the economic foundations upon 
 which they are laid. This is true of politics, of in- 
 dustry, of morals, of religion. A people's destiny is 
 determined by its economic environment. And the 
 relation of the people to the land is the controlling 
 influence of all else. A nation of home-owners is es- 
 sentially free, no matter what the political forms of 
 the state may be. Such a people is bound to be 
 democratic. All history bears witness to this fact. 
 It is the difference in the method of land tenure that 
 explains the political as well as the social institu- 
 
26 PRIVILEGE AND DEMOCRACY 
 
 tions of modern Europe. The countries of Switzer- 
 land, Holland, Denmark, France, and south Ger- 
 many are countries in which widely distributed 
 ownership prevails. On the other hand, Prussia, 
 Great Britain, and Russia are still feudal to the core. 
 It is the difference in the relation of these peoples to 
 the land on which they dwell that explains the es- 
 sential democracy of the former countries and the 
 caste and aristocracy of the latter. The social posi- 
 vion and political power of the ruling classes in the 
 latter countries are due to their economic rather than 
 to their political privileges. The privileged orders are 
 weakest where the land is most widely distributed; 
 they are strongest where the feudal system is least 
 impaired. If a nation is reared upon land monop- 
 oly its political institutions will reflect monopoly. 
 They are bound to be aristocratic. Those who own 
 the land will own the government. And wherever 
 the people are industrially free, wherever they own 
 their own homes, political institutions will reflect 
 that freedom. 
 
 With the enclosure of the land a change has come 
 over the spirit of our life. Population is crowding 
 in upon the cities. The energetic wage-earner, who 
 formerly followed the western trail, is now entering 
 the trades-union. Here he finds expression for the 
 energy which formerly found an outlet in the West. 
 It is this that explains the present industrial un- 
 rest. It is this that accounts for the political fer- 
 
THE FOUNDATIONS OF DEMOCRACY 27 
 
 ment. No longer can the discontented improve his 
 fortunes in another longitude. He must remain at 
 home as a tenant or a wage-earner. The alternative 
 of a homestead, which for three centuries relieved 
 the pressure of the world, is now closed forever. 
 
 Such is the significance of the American West. 
 Such are some of its contributions to our life. And 
 this development of ours is not an isolated phenome- 
 non. It is but a reflection of that which has gone 
 before. 
 
 Thus it is, as Loria has said, that America offers a 
 key to the enigma which Europe has sought for cent- 
 uries in vain. Thus the land which has no history- 
 reveals the course of universal history. For just as 
 the frontier offers a mirror in which the political, 
 social, and industrial conditions of colonial times 
 may be studied, so America offers a mirror of the 
 evolution of the western world from the expansion 
 of Rome down to date. So, too, the conditions 
 which the countries of Europe now present, disclose 
 to us the problems which we ourselves must pres- 
 ently face. 
 
CHAPTER m 
 THE RAPE OF THE NATION 
 
 We have seen that the settlement of America was 
 but the final act in a drama, whose beginnings coin- 
 cide with the dawn of Western civilization. Century 
 by century the process of nation-building has re- 
 peated itself, even the details being the same. This 
 has been true in the enclosure of the American West. 
 The experiences of Rome, of feudal Europe, of 
 England, and of Ireland have been reproduced in 
 almost every line of our public land policy. 
 
 When the Federal Constitution was adopted the 
 United States was the undisputed owner of almost 
 all the land between the Alleghany Mountains and 
 the Mississippi River. This territory formed the first 
 public land of the nation. The Louisiana purchase 
 added 1,182,000 square miles to this domain, which 
 was confirmed as to the Oregon country by the ex- 
 plorations of Lewis and Clark. The acquisition of 
 Florida increased the public lands by 54,000 square 
 miles, while the Gadsden purchase, by means of 
 which the southern part of Arizona was acquired, 
 added 25,000 square miles more. Texas, with an 
 area of 265,000 square miles, was annexed in 1845; 
 but as this territory had been temporarily independ- 
 
 28 
 
THE RAPE OF THE NATION 29 
 
 ent, its unoccupied lands did not become part of the 
 public domain. Leaving out of consideration the 
 recently acquired Pacific islands, the total area of 
 the public domain of the United States amounted to 
 1,849,072,587 acres, or about 3,000,000 square miles. 
 Its cost to the nation was four and seven-tenths cents 
 an acre.' This land was the unencumbered posses- 
 sion of the people. America was the greatest land- 
 lord in the world. 
 
 No such opportunity was ever offered to any 
 people. One cannot help dreaming of the America 
 that might have been had this imperial domain been 
 retained as the common possession of the nation. 
 Had the government reserved the title, and leased 
 the land under proper protection for improvements 
 in such quantities and as increasing population re- 
 quired, involuntary poverty need never have ap- 
 peared among us, while homes for unnumbered 
 millions would still be waiting in the prairies to 
 the west of the Mississippi River. Under such a 
 policy there would have been no million-acre estates 
 held for speculation and idle uses. The Pacific 
 railroads would not have acquired a twelfth of the 
 total public domain. Instead of a nation in which 
 one-half of the people have no homes of their own 
 there would have been ample abiding-places for 
 many times our present number. For were America 
 settled as densely as is France, there would be room 
 
 ' The Public Domain, Donaldson, pp. 14, 21. 
 
30 PRIVILEGE AND DEMOCRACY 
 
 for 480,000,000 people instead of one-sixth that 
 number. Were the population no denser than it 
 is in Germany, there would be accommodation for 
 800,000,000 people. For the empire of Germany 
 could be laid across the face of Texas and still 
 leave unoccupied an area three times the size of 
 Switzerland. 
 
 America could support five times its present popu- 
 lation in far greater comfort than that now enjoyed 
 by a large portion of the people, had the public 
 lands been allotted only as the needs of the people 
 demanded. For the resources of America surpass 
 those of all Europe. Had the nation reserved the 
 title of the land and leased it to users, the colossal 
 fortunes that have been contributed to the owners 
 of city and suburban sites would have remained in 
 the hands of the people. The same is true of the 
 mineral resources. Instead of enriching a handful 
 of men, who control, but do not develop, the iron, 
 the coal, the copper, the oil, and the natural gas 
 deposits, these resources would have remained the 
 common heritage of us all. By means of periodic 
 revaluations of the rental value we could have dis- 
 pensed with all other taxes and maintained ourselves 
 in affluence out of the increasing rents and royalties 
 of the public lands. The mineral deposits could have 
 been leased to private operators, just as many of 
 them are to-day by their owners, and worked under 
 such conditions as the Government saw fit to impose. 
 
THE RAPE OF THE NATION 31 
 
 Under such restrictions no billion-dollar monopolies 
 would have been created, competition would have 
 continued as in other lines of industry, while the 
 recurring wars of capital and labor would have been 
 forever impossible. *• 
 
 Had such a policy been pursued, opportunity 
 would still exist for unborn generations. In such a 
 nation there would be no landlords and no tenants. 
 The tenement and the slum would never have ap- 
 peared with the disease, poverty, and vice which they 
 inevitably produce. Crime would have remained at 
 a minimum, for crime is the product of poverty and 
 the lack of opportunity to work. In such a society 
 wages would have been determined by the will of the 
 worker, for opportunity would still be calling in the 
 unoccupied prairies of the public domain. Then 
 labor would have the alternative to work for itself. 
 And this is always the determining factor in the 
 fixing of wages. 
 
 There is nothing extraordinary about such a policy. 
 It is not even difficult of execution. The Govern- 
 ment has adopted just such a method in dealing with 
 the land of the Indian tribes of Oklahoma. It has 
 probably not been carried out with any critical jus- 
 tice for the Indians and yet the returns from this 
 source are colossal.' 
 
 ' The government has treated the Indians as its wards and leased 
 their lands on a royalty basis. The Osage Indians number 2,230. 
 Their reservation amounts to 1,470,000 acres. Prom this source, by 
 means of grazing, oil and gas royalties, the selling of lots, and interest 
 
32 PRIVILEGE AND DEMOCRACY 
 
 But no such vision has guided our policy. To be 
 quickly rid of our resources and on any terms has 
 been a consuming passion with us. Human inge- 
 nuity could scarcely have devised a more wasteful 
 policy than that which has been pursued. This 
 was especially true during the decade which fol- 
 lowed the Civil War. No demand on the part of 
 the interests powerful in Congress was too extrav- 
 agant to receive attention. It is estimated that 
 up to the year 1890, 337,740,080 acres of the public 
 lands were granted to corporations and states for 
 wagon roads, canals, river improvements, and rail- 
 roads.' This is an empire equal to one-sixth of 
 
 on funds, the income of the tribe for the fiscal year 1907 amounted to 
 $1,351,577.66, or $606 for every man, woman, and child in the tribe. 
 This is equivalent to nearly $3,000 a family. The royalty on the oil- 
 wells is one-eighth of all the oil produced. The royalty on gas is 
 $100 per annum for each gas-well in operation. The land belonging 
 to the tribe is leased for a limited period subject to re-appraisal. 
 A similar policy has been adopted as to other tribes. During the 
 fiscal year 1907, the government collected for the Choctaw and 
 Chickasaw Indians the sum of $652,875, from coal and other royal- 
 ties, and from the selling of town lots. The royalties and other 
 collections for the Cherokee nation amounted to $731,315.60, 
 and for the Creek nation the sum of $237,245.99. In ten years' 
 time, the coal and asphalt royalties of the Choctaw and Chick- 
 asaw nations amounted to $1,975,972.62. The total enrolled 
 population of the Choctaw, Chickasaw, and Cherokee and Creek 
 Indians was 98,000 and the amount which they received from the 
 administration of their estates by the government in the form of 
 ground-rent for the year 1907 amounted to $150 for every family 
 of five in the reservation. See annual reports of the Secretary of 
 the Interior. 
 
 '"The Populist Movement," by F. L. McVey, Economic Studies 
 (American Economic Association), Vol. I, p. 153. A large part of 
 these grants, however, was never actually patented by the grantees. 
 
THE RAPE OF THE NATION 33 
 
 the total area of the United States, including moun- 
 tain and desert lands as well as the territory of 
 Alaska. It is an area ten times the size of Iowa, 
 and three times the size of France, with its popu- 
 lation of 39,000,000 souls. 
 
 A carnival of prodigality attended the construc- 
 tion of the Pacific railways. They took what they 
 wanted of the public domain. In addition to a 
 right of way across the continent of from 100 to 
 400 feet wide, with such land as was needed for 
 sidings, stations, yards, and the like, a subsidy of 
 every alternate section of one square mile each 
 on either side of the right of way was added as 
 an aid to construction. The subsidy to the North- 
 ern Pacific Railway consisted of alternate odd-num- 
 bered sections to the amount of twenty alternate 
 sections per mile on each side of the road where 
 the line passed through the territories, and ten 
 alternate sections per mile on each side where it 
 passed through the states, extending from the west- 
 ern boundary of Minnesota to Puget Sound and the 
 Columbia River. 
 
 It is difficult to tell the amount of land that 
 was authorized by these grants. It is even more 
 difficult to ascertain the amount that was actually 
 patented by the railways. The land originally 
 granted has been estimated at 215,000,000 acres. 
 The official estimate of the Government Land Office 
 is somewhat less. It reports the grants at 155,514,- 
 
34 PRIVILEGE AND DEMOCRACY 
 
 994,000' acres, and the area actually patented by the 
 railroads as 73,942,260 acres. This does not include 
 38,000,000 acres granted to the railways by the state 
 of Texas. 
 
 But the land grants were not the only help which 
 the railroads received. A loan of $60,000,000 was 
 made to the Pacific railroads as an additional aid to 
 their construction. This, of itself, would have built 
 over 2,000 miles of railway across the continent. 
 It would have saved a great portion of the West 
 from railway monopoly forever and have furnished 
 a standard by which rates and services for the rest 
 of the country could have been measured.^ 
 
 Scandals of many kinds arose through the dealings 
 of the Pacific railways with Congress. These are the 
 dangers always alleged to be incident to government 
 ownership. Yet we are in a position to make a com- 
 parison of the relations of the government with the 
 Pacific railways with its experience in the construc- 
 
 ' The Public Domain, Donaldson, p. 268. 
 
 E. Benjamin Andrews, in The United States in Our Own Times, 
 chap. 4, gives the land grants to the six Pacific railroads as follows: 
 
 Union Pacific Railroad 13,000,100 acres 
 
 Central " " 12,100,100 
 
 Northern " " 47,000,000 
 
 Kansas " " 6,000,000 
 
 Atlantic and Pacific Railroad 42,000,000 
 
 Southern Pacific Railroad 9,520,000 
 
 129,620,200 acres 
 2 "The Secretary of Interior stated: ' The entire road (the Northern 
 Pacific) when completed, 2,700 miles, will have cost about $75,000,- 
 000 or at the rate of $28,000 a mile.' "—The Public Domain, p. 887. 
 
THE RAPE OF THE NATION 35 
 
 tion of the Panama Canal, which is being built by 
 the nation itself. 
 
 There has been no scandal, no bribery, no control 
 of political parties in connection with the latter en- 
 terprise, for there is no great interest to corrupt the 
 government. But the Pacific railways were given 
 land enough alone to more than pay the cost of 
 their construction. According to conservative esti- 
 mates the grants of the Northern Pacific Railway 
 alone were worth a thousand million dollars.' Had 
 the land been sold by the government to settlers, 
 who later purchased it from the railroads, five and 
 possibly ten transcontinental railways could have 
 been built from the proceeds of this grant. But 
 this is only the initial loss. Ever since the grants 
 
 * "Mr. Wilson, for many years the Commissioner of the Land De- 
 partment of the Illinois Central Railroad, . . . thought that if prop- 
 erly managed the Northern Pacific land would build the entire road 
 connecting the then terminus of the Grand Trunk through to Puget 
 Sound, the head of navigation on the Columbia, fit out an entire 
 fleet of sailing vessels and steamers for the China, East India, and 
 coasting trade, and leave a surplus that would roll up to millions. 
 He deemed the probable value of the grant $990,000,000, its pos- 
 sible value $1,320,000,000. "—The United States in Our Own Times, 
 E. Benjamin Andrews, chap. 4. 
 
 If this estimate of the value of the Northern Pacific land grants is 
 anywhere near correct and the cost of its building was not in excess 
 of $75,000,000, as estimated by the Secretary of the Interior, ten 
 transcontinental systems could have been built out of the sale of the 
 lands and still leave a surplus. The Union Pacific Railroad received 
 an average of $4.42 per acre for its land up to 1879. At this price 
 the Northern Pacific would have received $207,740,000, or enough 
 to have built three systems. 
 
 An exhaustive investigation of this grant was made by a com- 
 mittee of Congress, which reported that the entire cost of the North- 
 
36 PRIVILEGE AND DEMOCRACY 
 
 were made the government has been honeycombed 
 with the corrupting influences which have grown out 
 of the relationship. For years the Land Depart- 
 ment has been strugghng to recover milHons of acres 
 of agricultural, grazing, mineral, and timber lands, 
 which have been fraudulently enclosed, in addition 
 to the grants which the railways rightfully enjoy. 
 The states of the West and the Federal employees 
 have been corrupted by the same influences, while 
 the whole nation is struggling under flctitious rail- 
 way capitalization, inadequate trackage, insufficient 
 shipping facilities, and excessive charges. Had 
 Congress constructed the roads itself, had the nation 
 been plundered by the most corrupt of contractors, 
 it would still have received an immeasurably greater 
 return than it has enjoyed under the policy which 
 was pursued. 
 
 At the time these subsidies were granted public 
 opinion was quieted by the assertion that only by 
 
 em Pacific had been paid for out of the land grants, estimating the 
 land as only worth $3.00 an acre, and that a surplus of $41,284,000 
 remained for the company. The committee said in its report to 
 Congress: "The undersigned suppose that all that could be asked of 
 the government in the exercise of the most prodigal generosity would 
 be a suflScient amount of lands to enable the company to construct 
 its road without costing it a single dollar of its own money, and as 
 either of the foregoing hypotheses shows a surplus of many millions 
 more than are necessary for that purpose it has occurred to them 
 that it might be to the interest of the people of the United States 
 generally to look somewhat after the surplus, whatever it may be. 
 . . . There are no good reasons yet apparent why the people should 
 pay the cost of its construction and present the company with a 
 colossal fortune besides. " — The Public Domain, Donaldson, p. 889. 
 
THE RAPE OF THE NATION 37 
 
 these means would the West be peopled, and that 
 through this settlement the remaining land would be 
 greatly increased in value. To some extent this has 
 been true. The railways were built some years 
 earlier than they otherwise would have been. And 
 land values were increased in consequence. But the 
 price has been a fearfully costly one. Large parts 
 of the .West have been strangled in consequence. 
 Millions of acres are still held by the railroads for 
 speculative purposes, while great manorial estates, 
 with hired men and a tenant class, are to be found 
 wherever the railway grants were made. Out of these 
 subsidies the bonanza farms of ten, twenty, one 
 hundred thousand, and even a million acres have 
 been carved. Many of these great feudatories cover 
 whole counties. Some of them are larger than an 
 Eastern state.* 
 
 Land-grabbers and ranchmen followed close behind 
 the railways and appropriated great tracts of land 
 
 ' As instances of the great estates which are to be found in almost 
 every state of the West, many of which were made possible by the 
 railway land grants, the following may be cited: "The Texas Land 
 Syndicate No. 3 owns 3,000,000 acres in Texas, in which such English 
 noblemen as the Duke of Rutland and Lord Beresford are largely 
 interested. Another syndicate, the British Land Company, owns 
 300,000 acres in Kansas, besides tracts in other places. The Duke 
 of Sutherland owns hundreds of thousands and Sir Edward Reid 
 controls 1,000,000 acres in Florida. A syndicate containing Lady 
 Gordon and the Marquis of Dalhousie controls 2,000,000 acres in 
 Mississippi. " — The Menace of Privilege, by Henry George, Jr., p. 36. 
 
 In addition to these the Marquis of Tweeddale owns 1,750,000 
 acres, Phillips, Marshall & Co. (London), 1,300,000 acres, the 
 Scully estate 2,000,000 acres, the Holland Land Co. 4,500,000 acres. 
 
38 PRIVILEGE AND DEMOCRACY 
 
 from which they refuse to be dislodged. The rail- 
 roads themselves have kept great areas out of use. 
 The alternate sections, checker-boarded within the 
 limits of the railway grants, have been fenced in. 
 Actual settlers are denied access to them. By virtue 
 of the lieu land laws, the railways are permitted to 
 substitute new sections for those which the govern- 
 ment has reserved for schools, forests, and other 
 purposes. This power is used to cloud titles. By 
 means of it mineral claims, developed by honest pros- 
 pectors, are appropriated under some claim of title, 
 and men who have spent their lives in the develop- 
 ment of a property are forcibly ejected from their 
 holdings, or exhausted by the delays and expenses of 
 protracted legal controversies. By these and similar 
 means whole commonwealths are arrested in their 
 development; titles of property are rendered inse- 
 cure, and great areas of land are closed to occupancy. 
 The history of the relation of the government to 
 the Pacific railways has been one of stupendous folly. 
 It has been one of the most costly experiences of the 
 nation. The financial cost of the Civil War does not 
 compare with the loss involved in our land policy. 
 Not only were the railway grants capable of sustain- 
 ing from ten to twenty million people in comfort; 
 not only were the forest and mineral resources bar- 
 
 and a German syndicate 1,100,000 acres. Fifty-four individuals 
 and foreign syndicates own 26,710,390 acres, an area greater than 
 seven of the more populous Eastern states with a population of 
 8,359,000 people. 
 
THE RAPE OF THE NATION 39 
 
 tered away in the process, but the entire West was 
 so involved — poUtically, socially, and industrially — 
 that it has remained as a vast feudatory to the Pacific 
 railway systems. Its politics reflect the interests 
 which control the railways, the land grants, and the 
 resources of the country. In Congress and at home 
 these interests struggle to stifle every expression of 
 real democracy. 
 
 But the tale of our wastefulness does not end with 
 the railway land grants. Probably an even greater 
 area has been stolen by persons and corporations 
 in conspiracy with the railways or the agents of the 
 government. The extent of these fraudulent en- 
 closures will probably never be known. In a re- 
 cent issue of a popular magazine is a story of a 
 poor German who landed in this country in 1850; 
 of how he became the owner of 14,539,000 acres of 
 the richest land in California and Oregon. His 
 enclosures cover 22,500 square miles, an area three 
 times as great as the state of New Jersey with 
 its population of 1,500,000 souls. The story tells 
 how one hundred men in the Sacramento Valley 
 came to own 17,000,000 acres; of ranches of eight, 
 twenty, and even one hundred miles in extent; of 
 single estates twice the size of Belgium, bigger 
 than all Switzerland, bigger even than the com- 
 bined areas of New Hampshire, Massachusetts, 
 Connecticut, and Delaware.* Other investigations 
 
 ' Everybody's Magazine, May, 1905. 
 
40 PRIVILEGE AND DEMOCRACY 
 
 indicate that more than 150,000,000 acres have 
 been illegally or collusively appropriated from the 
 public domain/ 
 
 It is probable that from 250,000,000 to 350,000,000 
 acres of the public domain have been granted to the 
 Pacific railways or illegally appropriated by persons 
 and corporations in conspiracy with the agents of 
 the government. We have no complete data on the 
 subject, but the investigations made during the ad- 
 ministration of President Roosevelt, as well as the 
 disclosures in the federal courts, indicate that a large 
 part of the best land of the nation has been acquired 
 by dishonest means. The homestead entries covering 
 a period of forty years amount to but 111,000,000 
 acres. The timber, stone, desert land, lumber 
 
 ' An exhaustive study has been made of these operations by Mr. 
 William R. Lighten, of Omaha, Neb., and published in the Boston 
 Transcript. He says: 
 
 "Within the last fifteen years there has been stolen from the public 
 domain not less than 150,000,000 acres; an area that would make 
 thirty states of the size of Massachusetts, five states as large as New 
 York, or three states as large as Kansas. When the truth is known 
 — as it may be by and by — these figures will doubtless be doubled, 
 trebled, or quadrupled. The present statement is one justified by 
 present knowledge. A recent grand-jury investigation in California, 
 backed up by other official inquiry, disclosed that one man alone in 
 that state holds the title to nearly 15,000,000 acres, acquired within 
 the time named by the flagrant processes of theft. There are 
 dozens and even scores of men whose stealings will run from 10,000 
 to 1,000,000 acres or more, the extent of their grabs depending 
 principally upon their ability to swing transactions to a successful 
 issue. 
 
 " No reference is made to the solemn, semi-oflScial chicanery of the 
 railroad land grants or to the equally bald grants in the South-west, 
 glossing over earlier pilferings. Those deals appear by comparison 
 
THE RAPE OF THE NATION 41 
 
 culture, and coal land entries amount to but 51,000,- 
 000 acres more; 168,000,000 acres have been with- 
 drawn by the government as forest preserves, while 
 over 700,000,000 acres of mountain and desert lands 
 (one-half of which are in Alaska) still remain un- 
 surveyed. The grand total of lands accounted for 
 by legal entry, authorized grants, or reservations 
 falls short of the total lands of the nation by many 
 hundreds of millions of acres. By a process of 
 elimination it should be possible to ascertain how 
 much of the public domain had been fraudulently 
 appropriated. But no such inventory of our national 
 assets has ever been taken. 
 
 By the processes indicated, America has been 
 despoiled of an empire greater than the combined 
 areas of the thirteen original states. Yet it has ex- 
 cited but momentary activity on the part of the gov- 
 
 impeccably honest and above reproacli. This charge relates only 
 to such downright, outright, deliberate stealings as cannot be de- 
 scribed by any other name, bearing no stamp of formal official 
 approval. 
 
 " Wherever there is a body of public land large enough to make 
 a bait worth swallowing, there the thefts are going on. Lands of 
 every description are included. Millions of acres in the rich wheat 
 valleys of California have been stolen; millions of acres of grazing 
 lands on the plains of Kansas, Nebraska, Dakota, Wyoming, and 
 Montana have been stolen, not to mention the earlier stealings in the 
 now almost devastated timber regions of Michigan, Wisconsin, and 
 Minnesota; and now the lumber thieves are plying their shameless 
 trade unhindered in the new fields of Mississippi and other unde- 
 veloped districts of the South; unnumbered acres of mineral land 
 have been stolen — in fact, nothing worth stealing has escaped the 
 clutch of these bold outlaws." See issues of Boston Transcript of 
 May 20 and 27, June 3, 10, 17, and 24, and July 1, 1905. 
 
42 PRIVILEGE AND DEMOCRACY 
 
 ernment and aroused only isolated protests on the 
 part of the press. Had some foreign power laid its 
 hands upon one of the most worthless of our Pacific 
 islets, the nation would have burst forth into a de- 
 mand for war with all of its devastating cost in life 
 and treasure. 
 
 It may be suggested that the reports to which 
 reference has been made are the unscientific investi- 
 gations of magazine writers. But official documents 
 show conclusively the growth of land monopoly and 
 the questionable methods employed to acquire pos- 
 session of the public domain. 
 
 The Public Lands Commission, appointed by Presi- 
 dent Roosevelt, after an exhaustive inquiry, says: 
 
 "Detailed study of the practical operation of the 
 present land laws shows that their tendency far too 
 often is to bring about land monopoly rather than to 
 multiply small holdings by actual settlers. 
 
 "... Not infrequently their effect is to put a 
 premium on perjury and dishonest methods in the 
 acquisition of land. It is apparent, in consequence, 
 that in very many localities, and perhaps in general, 
 a larger proportion of the public land is passing into 
 the hands of speculators than into those of actual set- 
 tlers who are making homes. . . . Nearly everywhere 
 the large land-owner has succeeded in monopolizing 
 the best tracts, whether of timber or agricultural land. 
 . . . Your commission has had inquiries made as to 
 how a number of estates selected haphazard have 
 been acquired. Almost without exception collusion or 
 evasion of the letter and spirit of the laws was involved. 
 It is not necessarily to be inferred that the present 
 
THE RAPE OF THE NATION 43 
 
 owners of these estates were dishonest, but the fact 
 remains that their holdings were acquired or con- 
 soHdated by practices which cannot be defended. " ' 
 
 The growth of land monopoly and the proportions 
 which it has already attained are confirmed beyond 
 any question by the United States Census. These 
 statistics tell a story quite as convincing as the more 
 dramatic reporting of contemporary literature. From 
 the Census returns of 1900 it appears that of the 
 841,000,000 acres of land under cultivation in the 
 United States, 200,000,000 acres are in farms whose 
 average size is 4,230 acres. These farms are owned 
 by 47,276 persons. One-fourth of the total acreage 
 of America is owned by .0006 of the population. The 
 area so owned is considerably greater than the com- 
 bined area of Germany and Great Britain. These 
 nations support a population of 100,000,000 souls. 
 Yet here in America a quarter of the cultivated 
 land is owned by a handful of persons, whose total 
 number is less than that of a good-sized suburb of 
 an Eastern city. 
 
 So far as future generations are concerned, it is a 
 matter of indifference whether these colossal holdings 
 were obtained by fraud or by honest means. Mo- 
 nopoly is as oppressive in one instance as in the 
 other. However they may have been acquired, 
 the opportunity to make provision for the future has 
 passed from us. This is a fact of portentous sig- 
 
 ' Senate Document No. 154, 58th Congress, 3d Session, p. 14. 
 
44 PRIVILEGE AND DEMOCRACY 
 
 nificance. For man is a land animal. Upon the 
 land all life depends. From it humanity draws its 
 strength just as did the mythological Antaeus. 
 Everything that man consumes comes from the land. 
 And the tribute which must now be paid by those 
 who toil to those who own the land is determined by 
 the law of demand and supply, population ever in- 
 creasing, land ever constant and limited in amount. 
 
CHAPTER IV 
 THE STRANGLE HOLD OF MONOPOLY 
 
 We have been prodigal beyond measure with our 
 pubUc lands, but we have been criminally wasteful in 
 the disposal of our mineral resources. The face of 
 the continent is underlaid with coal, iron, copper, 
 petroleum, natural gas, lead, zinc, gold, silver, and 
 other mineral deposits. Many of these minerals are 
 almost as accessible as the air above, and only less 
 inexhaustible. Nature set no limit to the generos- 
 ity of her endowments. Not alone agriculture, but 
 every conceivable industry was provided for, as 
 though Providence had contemplated that in this 
 new continent, a new race, free from the mistakes of 
 the past, might try again the experiment of nation- 
 building. 
 
 Yet within a generation these great gifts have 
 been appropriated. They are owned against the 
 claims of generations as yet unborn. This owner- 
 ship is not primarily for use, it is not for enjoyment, 
 it is for the purpose of excluding others who would 
 use them from the opportunity of doing so. This 
 monopoly of the resources of the country is as por- 
 tentous to our life as is the enclosure of the land 
 itself. For the civilization of the future is an indus- 
 
 45 
 
46 PRIVILEGE AND DEMOCRACY 
 
 trial one, and it is upon the raw materials of pro- 
 duction that the life of to-morrow depends. 
 
 Men are still living whose memory goes back to the 
 first timid experiments in the mining of anthracite 
 coal. These ranges are limited to a small area in 
 north-eastern Pennsylvania. But a comparatively 
 few years ago the region was of little value. It is 
 still covered with scrubby forests and is little suited 
 to cultivation. Yet these barren mountain-sides 
 have been capitalized at hundreds of millions of 
 dollars. Shipments of coal have reached an annual 
 aggregate of over 70,000,000 tons.^ The labor cost 
 at the mouth of the mine, as evidenced by testimony 
 presented to the Interstate Commerce Commission, 
 is less than $2.00 per ton. The freight rate to the 
 seaboard is $1.55 per ton. The price to the consumer 
 at tidewater is over $6.00 per ton.^ 
 
 Upon this supply of coal the entire Eastern sea- 
 board, as well as a large part of the central West, is 
 dependent for light, heat, and power. Over ninety- 
 six per cent, of the mines are owned or controlled by 
 the eight great railroads which enter the region, and 
 the price of coal is fixed, and the conditions of pro- 
 
 ' According to the United States Geological Survey the total pro- 
 duction in 1907 was 76,432,421 tons, and the value at the mines 
 was $163,584,056. 
 
 2 At a hearing held before the New York State Railroad Commis- 
 sion in 1900, the president of the New York, Ontario and Western 
 Railroad made the startling admission that "without some restric- 
 tion (such as railway control) stove coal would be a drug in the 
 market at two dollars a ton." 
 
THE STRANGLE HOLD OF MONOPOLY 47 
 
 duction are determined, by a little group of men, who, 
 within a few years' time, have acquired possession of 
 the mass of securities which overlay these properties. 
 Through the merger of the railroads and the coal 
 fields, stock and bonds in excess of $400,000,000 
 have been issued, a sum equal to nearly one-half of 
 the present Federal debt. By means of the monop- 
 oly which has been acquired, a tribute is exacted 
 from the American people of from $100,000,000 to 
 $200,000,000 a year. Under the control of this 
 syndicate 167,000 men are employed, and nearly 
 1,000,000 souls supported. The wages of the men, 
 their hours of employment, even the prices they shall 
 pay for the barest necessities of life, are determined 
 by a Wall Street syndicate, indifferent, and largely 
 ignorant, of the industry which it controls, except as 
 its operations affect the stock market. 
 
 Here is a deposit of nature which all of the wis- 
 dom of science and all of the ingenuity of man could 
 not reproduce. Upon its use the transportation, in- 
 dustry, heat, even life itself, of a large portion of 
 America depend. Yet it may not be used, may not 
 be brought to the surface, and may not be conveyed 
 to market, except upon the permission of those who 
 have acquired the title-deeds of ownership against 
 80,000,000 of their fellow creatures, the joint heirs 
 to this bounty of Providence. 
 
 In 1859 petroleum was discovered. This dis- 
 covery has given birth to a dozen fortunes which 
 
48 PRIVILEGE AND DEMOCRACY 
 
 run into the hundreds of millions. In fifty years' 
 time open-hearted nature has poured forth wealth 
 to the value of billions. Upon this prodigal en- 
 dowment an industrial fabric has been reared whose 
 tributaries, like those of a mighty empire, include 
 transportation systems by land, and navies by sea, 
 as well as mines of gold, silver, copper, and coal, 
 richer by far than those of the Incas; while banking, 
 insurance, and myriads of other industries, whose 
 ramifications no one completely knows, carry its 
 influence to every corner of the earth.' Its em- 
 ployees exceed in number the army of Napoleon at 
 the battle of Waterloo, and its financial dealings 
 surpass in amount the budget of the Federal Gov- 
 ernment. No hamlet is so obscurely hidden and no 
 nation is so powerful that it does not pay tribute to 
 the system which has been erected by the master 
 hands who have woven the influence of "Standard 
 
 ■ At the investigation of the Standard Oil Company in New York 
 in November, 1908, one of the officials of the Standard Oil Company, 
 at the request of the coimsel for the Federal Government, produced 
 a list of the oil, gas, and pipe-line companies owned or controlled by 
 the Standard Oil Company. This list included 117 companies with 
 a combined capitalization of $328,301,495. This included the 
 Standard Oil Company of New Jersey at its par value. Were it 
 included at its market value and the other corporations at their par 
 value the combined capital value of these companies alone would 
 exceed three-quarters of a billion dollars. 
 
 No report was made of the mining, railway, franchise, land, 
 banking, transmission, and manufacturing corporations owned or 
 controlled by the Standard Oil Company or its chief stockholders. 
 But from what we know of the influences and control of the men 
 who are identified with that corporation, the stock holdings which 
 they control must equal many times the above sum. 
 
THE STRANGLE HOLD OF MONOPOLY 49 
 
 Oil " into the political, industrial, financial, and even 
 the educational life of America, until no activity 
 and no industry is free from it. Petroleum pours 
 forth from the earth almost as freely as do the 
 springs from the mountain-sides.* It is one of the 
 great civilizing agencies of the age. Through its use 
 much of the culture and enlightenment of the last 
 century has been made possible. It has relieved the 
 drudgery of the farm and the cottage; it has made 
 possible the universal education of the people. Yet 
 this fountain of nature has passed into the hands 
 of men who have not only monopolized the out- 
 put but have controlled the means of communica- 
 tion, so that every other producer has been subject 
 to its will in the bringing of oil into use. 
 
 But a few years after the discovery of petroleum, 
 natural gas burst from the earth. Here was light 
 and fuel, distilled in nature's laboratories, adequate 
 for the needs of the great central West. It was 
 almost as free as the waters of the Great Lakes. Here 
 was fuel for the upbuilding of the industries of a 
 third of the population of America. Here was light, 
 heat, and power adequate for generations as yet un- 
 born. Yet in a few years' time these reservoirs of 
 nature have been overlaid by title-deeds, held most 
 largely by those who had already made petroleum 
 their servant, and whose incomes are being aug- 
 
 'In 1907 the value of the petroleum produced amounted to 
 $120,106,000. 
 
50 PRIVILEGE AND DEMOCRACY 
 
 mented by unknown millions each year from this 
 mysterious source. 
 
 State after state is also underlaid with broad acres 
 of bituminous coal. These deposits run from the 
 Alleghanies to the Rockies. From the original own- 
 ers they passed to independent operators; from 
 the independent operators they have largely passed 
 to the railroads. In Pennsylvania, West Virginia, 
 Ohio, Indiana, Illinois, Missouri, and Colorado, the 
 alliance between the coal mine and the railway has 
 long been complete. There is scarce a great railroad 
 system that does not own or control great areas of 
 bituminous coal. In many instances their holdings 
 have been increased, independent operators have 
 been crushed, and competition has been killed by 
 the methods repeatedly laid bare by the investiga- 
 tions of the Interstate Commerce Commission. The 
 long-familiar practices of the oil industry, of dis- 
 criminating freight rates, alleged car shortages, 
 and intimacy of ownership, have placed operators, 
 as well as whole sections of the country, under 
 the arbitrary control of the public carriers of the 
 nation. This community of ownership between 
 the railroads and the coal companies is now pro- 
 hibited by Federal statute. The letter of the 
 law may be observed, but community of interest, 
 through the common ownership of the capital 
 stock, cannot be reached by statute or by crim- 
 inal prosecution. 
 
THE STRANGLE HOLD OF MONOPOLY 51 
 
 In the bituminous, as well as in the anthracite 
 coal industry monopoly is the result of legal rather 
 than of illegal means. This is true of every mo- 
 nopoly that is identified with the land. It is not the 
 law-breaker, it is the law-maker, who is responsible 
 for this sort of monopoly. For the right of private 
 ownership carries with it the right of unlimited 
 ownership. And unlimited ownership carries with it 
 the right to do as one wills with one's own, whether 
 it be a jack-knife, a coal mine, or a great railroad 
 system.* 
 
 It is little more than a score of years since the 
 low-lying hills of northern Michigan, Wisconsin, and 
 Minnesota disclosed their untouched treasures of 
 Bessemer ore to man. In 1884 the Vermillion and 
 Menominee iron mines were first opened up to use. 
 Eight years later the Mesabi range, then, as now, a 
 trackless timber waste, was uncovered, and close 
 below the surface wealth more fabulous than any 
 Comstock or Kimberley lode was laid bare. Here 
 were the foundations of the civilization of to- 
 morrow. For steel was soon to be king. And here 
 is Bessemer ore, whose value in the ground has been 
 estimated by officials of the Steel Trust at from one 
 to two thousand million dollars.^ Here is the struct- 
 ural basis of the railway, the steamship, the factory, 
 
 •The value of the output of bituminous coal in 1907 was $451,- 
 214,000. The industry employed 513,258 men. 
 
 "Report of Industrial Commission, Vpl, XIII, (Washington) p. 472. 
 
52 PRIVILEGE AND DEMOCRACY 
 
 the ofSce building, and the home. Here are the 
 means for the conveyance of water, of gas, of heat, 
 and of power. To-day eighty-eight per cent, of the 
 iron ore of the United States comes from these barren 
 hillsides. The ore is mined by open surface cuts, as 
 cheaply and as easily as if it were the sand by the sea. 
 It costs but a few cents a ton to mine the Mesabi ore. 
 It involves no more labor cost than the removal of a 
 ton of dirt. Yet almost all of these deposits have 
 passed under the control of the United States Steel 
 Corporation. It has more recently acquired the vast 
 deposits in the South through the purchase of the 
 Tennessee Coal and Iron Company. It indirectly 
 controls the Colorado ore field as well. It is this 
 monopoly of the raw materials of production that en- 
 abled the promoters of the Steel Tnist to capitalize 
 it at a billion and a half dollars. It is through this 
 means that it dominates the markets of America if 
 not of the world.* 
 
 The Steel Trust is invincible, not because of the 
 skill, talent, or industry of its promoters; not be- 
 cause of the plants, mills, or furnaces which it has 
 erected. The power of the Steel Trust lies in its 
 control of the iron-ore mines of the Lake Superior 
 region and of Alabama, Tennessee, and Colorado, 
 together with the coking coal, gas, and limestone 
 quarries of Pennsylvania. These, with the prohibi- 
 
 ' The value of the iron-ore production in the United States in 1907 
 was $131,996,000. 
 
THE STRANGLE HOLD OF MONOPOLY 53 
 
 tive tariff which the iron and steel interests have ob- 
 tained, make its control complete. For the Steel 
 Trust owns from 60,000 to 80,000 acres of Connells- 
 ville coal. It produces something over one-half the 
 coke of the United States. This is the best coking 
 coal in the world. "There is no more Connellsville 
 coal," said Mr. Charles Schwab, the former presi- 
 dent of the steel corporation. "You could not buy- 
 it for $60,000 an acre. . . . Every acre of it is very 
 highly prized, and that is owned by all these con- 
 stituent companies in toto. " ' The company also 
 owns 98,000 acres of gas and oil lands. 
 
 Only less marvellous than the story of anthracite 
 coal, of the gas and the iron-ore deposits, is the story 
 of copper. In northern Michigan, in Arizona, and 
 in Utah are copper deposits whose only rival is the 
 Rio Tinto in Spain, owned by the Rothschilds. Of 
 these, the Calumet and Hecla is easily chief. The par 
 value of its stock is $25.00 a share. Of this but 
 $12.00 a share has ever been paid in. The shares 
 of this company have recently sold as high as $1,000, 
 and its quarterly dividends exceed the original pay- 
 ments for the stock. Copper has made many multi- 
 millionaires, just as it has wrecked many bank 
 clerks. The annual value of the copper output of 
 America exceeds $173,799,000, and the control of the 
 markets of America now rests in the hands of the 
 same men who have laid their hands upon the iron, 
 
 ' Report of the Industrial Commission, Vol. XIII, p. 464. 
 
54 PRIVILEGE AND DEMOCRACY 
 
 the oil, the gas, the coal resources, and the railways 
 of the country. All society is paying tribute to these 
 men. For copper, next to coal, iron, and steel, is the 
 most universal necessity of modern industrial life. 
 
 All over the land the needs of a great civilization 
 were anticipated by Providence. Here were re- 
 sources adequate for uncounted millions of people. 
 If it is possible to infer any divine purpose in the 
 ordering of the universe, surely these deposits of 
 wealth were designed for the use of all the people, 
 rather than the exclusive ownership by a few. Yet 
 no state in the Union has so much as reserved a roy- 
 alty for their use, and no community has placed them 
 upon the tax duplicate at much more than their 
 farming value. Yet a moderate royalty upon the 
 mineral output of the country would have been suf- 
 ficient to pay all of the present expenditures of the 
 Federal Government.' Nature, generous to a de- 
 gree, has been thwarted by laws of our own making. 
 Society, with even less wisdom than the wild animals 
 of the forest, has erected barriers between itself and 
 its inheritance. Within less than a generation, these 
 
 > The United States Geological Survey for 1908 gives the value of 
 the mineral output of the country for the year 1907 as 12,069,289,- 
 196. Pig iron is valued at $529,958,000; copper at $173,799,000; 
 bituminous coal at $451,214,000; anthracite coal at $163,584,000; 
 petroleum at $120,106,000; and natural gas at $52,866,835. Had 
 the government retained a royalty on the mineral products of the 
 country of 25 per cent, the revenues of the nation would have 
 amounted to $517,322,299, or almost the sum which is now col- 
 lected by the government from the customs and the internal revenue 
 system. 
 
THE STRANGLE HOLD OF MONOPOLY 55 
 
 gifts, which but a few years ago were valued as agri- 
 cultural land, have been massed under the control 
 of Wall Street. From year to year the control is 
 narrowing, until in a few years' time practically all 
 of the mineral resources of the country, whose present 
 annual production exceeds two billion dollars, wUl be 
 under the dominion of a very few men. That such a 
 power should be enjoyed by any irresponsible set of 
 individuals seems as contrary to any proper ordering 
 of society as that the air should be enclosed, and its 
 enjoyment be made the subject of an arbitrary toll. 
 Closely allied with the resources of the nation are 
 the great transportation systems. They are the ar- 
 teries of our life. During the last few years system 
 has been added to system until nearly 200,000 miles 
 of railway have been merged into a half-dozen groups, 
 with a combined capitalization of over nine billion 
 dollars.' Within these syndicates three-fourths of the 
 mileage of America is held, while each group, in turn, 
 is bound to the other by a community of interest, by 
 fear, or by agreement, so that for all practical pur- 
 poses the transportation agencies of the nation act 
 as a unit. Their ultimate consolidation into a single 
 monster corporation is not an inconceivable thing to 
 forecast, or an unreasonable thing to expect.^ 
 
 • See Moody, Truth about the Trusts. 
 
 ^On the death of Mr. Harriman in 1909 it was authoritatively 
 stated that he "absolutely controlled" 21,939 miles of railway, and 
 " dominated " 65,176 miles, or one-fourth of the total mileage of 
 America. 
 
56 PRIVILEGE AND DEMOCRACY 
 
 Already the industrial life of the nation rests in 
 the hands of these Titans of finance, who, in recent 
 years, have made use of the banks and insurance 
 companies to secure control of the resources and 
 transportation agencies of the country. For who- 
 ever controls the highways controls the vital organs 
 of society, and when to this is added the raw ma- 
 terials of production, the dominion is complete. 
 The tribute which may be taken is like the spoils of a 
 Roman conqueror. From the decision of the owner 
 there is no appeal, for of competition there is none. 
 By the stroke of a pen hundreds of millions of dollars 
 may be transferred from the pockets of the people to 
 the pockets of the owners of these great interests. 
 The advance in the published freight rates upon all 
 the railroads in the country in the year 1900 was prob- 
 ably not less than twenty-five per cent.' During the 
 four years from 1899 to 1903 $155,000,000 was added 
 to the earnings of the railways through the increase in 
 freight rates alone.^ An insignificant increase in the 
 price of oil, of coal, or of copper produces a similar 
 result. It is by such means as these that the wealth of 
 the producers of America is surely and stealthily being 
 appropriated. It is by this process that the pennies 
 of the millions are becoming the millions of the few. 
 
 It is impossible to ascertain the extent to which the 
 wealth of America has been massed within the past 
 
 ' Report of Industrial Commission, Vol. XIX, p. 285. 
 
 !" Senate Document No. 257, 58th Congress, 2d session, p. 8. 
 
THE STRANGLE HOLD OF MONOPOLY 57 
 
 ten years, but an examination of Moody's Truth 
 about the Trusts discloses the extent to which the 
 Standard Oil, Rockefeller, Morgan, Ryan, Elkins, 
 Widener, and Havemeyer interests have secured 
 control of the railways, the mining, the franchise, 
 and the protected industries, whose combined cap- 
 italization amounts to approximately twenty-five 
 thousand million dollars. 
 
 Incredible as is this exhibit of wealth, it is but the 
 beginning of the enumeration. It does not include 
 the great fortunes, like the $450,000,000 Astor es- 
 tate, which have come from city land values; it 
 does not include the gold and the silver mines, the 
 franchise corporations, the insurance, banking, and 
 other fortunes; it does not include the multitude 
 of industrial combinations, which, through the ma- 
 nipulation of the stock market, have fallen under 
 the same control. 
 
 Such a mass of wealth staggers the imagination. 
 The thought of millions conveys no impression, even 
 to those accustomed to think in big figures, while 
 thousands of millions are like the astronomical 
 distances which separate the stellar bodies. Yet 
 within the control of a score of men is a calculable 
 sum in excess of the total wealth of the United 
 States at the close of the Civil War. It amounts to 
 more than one-fifth of all the wealth of the country, 
 as ascertained by the Census in 1904. 
 
CHAPTER V 
 THE TOOLS OF PRIVILEGE 
 
 How has this colossal mass of wealth been ac- 
 quired? By what means have a few men, uncon- 
 nected with the fields of industry, and in many in- 
 stances wholly ignorant of its processes, been able to 
 acquire possession of the railways, the franchise 
 corporations, the protected industries, the mineral 
 resources, and a great part of the land of America, 
 whose increasing earnings, like a mountain, rest on 
 the backs of humanity? For the properties so 
 acquired are the most profitable in the country. By 
 an unfailing instinct the natural monopolies have 
 been appropriated first. How has this been achieved ? 
 How has it been possible for a handful of men to 
 acquire possession of wealth in excess of that which 
 the 16,000,000 workers of America, at the current 
 rate of wages, could produce in two long years? By 
 what means has the United States been changed 
 from a country in which opportunity seemed open to 
 all for many generations to come, to the conditions 
 which now confront us? 
 
 A short generation ago all this would have seemed 
 impossible. Yet nothing was simpler. We hung 
 our treasures in the streets, and now wonder why 
 
 58 
 
they are gone. Not content with exposing them 
 to the first comer, we created the means for car- 
 rying them away. We asked men to appropriate 
 our mineral resources, and then passed tariff laws 
 to make monopoly inevitable and invincible. We 
 turned over the highways to private hands, and now 
 wonder why they are managed as a private bus- 
 iness. We encouraged land monopoly, and are 
 now amazed at the growth of a peasant tenantry. 
 Having done these things we then created the most 
 perfectly adjusted financial machinery for complet- 
 ing the process. 
 
 In 1896 "the money monopoly" seemed a heated 
 Populistic phrase. Within the past few years the 
 methods of banking have been laid bare. Scattered 
 all over America are savings and trust companies 
 whose deposits range from a few thousands to tens of 
 millions of dollars. In these banks are the savings 
 of the rich and of the poor. In the larger interior 
 cities, like Chicago, St. Louis, Cleveland, and Pitts- 
 burg, are banks which are used by the smaller towns 
 for the purpose of clearance. Here the inland banks 
 maintain reserves for the easier transaction of their 
 business. And just as the smaller banks make use 
 of the inland cities as depositaries, so the latter make 
 use of the banks in New York for the same purpose. 
 By this means Wall Street has become the financial 
 reservoir of the nation. Here the money and the 
 available credit of America is gathered, just as the 
 
60 PRIVILEGE AND DEMOCRACY 
 
 local bank gathers the pennies, dimes, and dollars 
 of the people. 
 
 For years Wall Street has been the centre of for- 
 eign exchange. It is the clearing-house of America. 
 These functions it still performs. They are of great 
 value to the complex industrial relations of the mod- 
 ern world. Here, too, is the government sub-treas- 
 ury. Here are banking institutions whose operations 
 rival in magnitude those of the Bank of England. 
 Here are the trust companies whose powers are 
 more ample than those of any bank in the world. 
 Through these agencies the business of America 
 passes. Through the government sub-treasury, the 
 trust companies, the banks, and the insurance com- 
 panies, credit transactions circulate to the uttermost 
 extremities of the land. Wall Street is the centre of 
 the circulatory system of the nation.' 
 
 Closely identified with the banks are the great in- 
 surance companies, whose agents in every part of the 
 country gather up the savings of the people, precau- 
 tionary investments for old age or some calamity of 
 nature. These premiums also flow to Wall Street. 
 These premiums together with the reserves likewise 
 run into the hundreds of millions of dollars. 
 
 All of these agencies run and ramify into each 
 other. They have the same stockholders, the same 
 directors, the same officers, and the same interests. 
 
 ' The clearances of New York during the year 1909 amounted to 
 one hundred billion dollars. 
 
THE TOOLS OF PRIVILEGE 61 
 
 The trust companies are organized and controlled 
 
 by the directors of the insurance companies. The 
 
 same men own the national banks. A few score 
 
 of men practically control the available money of 
 
 America. They not only have the use of the local 
 
 deposits of New York, but of the balances deposited 
 
 with them by the West. They can increase these 
 
 deposits at will by putting up the rates of interest on 
 
 call money to any point they desire. This lures still 
 
 more deposits from the inland banks. In addition 
 
 the group of men who have acquired control of 
 
 the great financial institutions in New York, control 
 
 or have an interest in banks and trust companies 
 
 from the Atlantic to the Pacific. This is true even 
 
 of the banks of the smaller inland towns. Thus 
 
 the money, and what is more important the credit, of 
 
 America has been monopolized. Whoever owns the' 
 
 means of credit controls the industrial life of the 
 
 nation.' All industry is subject to its will. Upon 
 
 the favor of these financial interests great railroad 
 
 systems are dependent. The richest corporation in 
 
 the world can no more ignore this combination than 
 
 'This was demonstrated by the panic of 1907. It was a money 
 and not an industrial panic. It was produced by Wall Street specu- 
 lation. Values had been carried upward and upward by the use of 
 banking loans. They collapsed by their own weight, and caused 
 such a dislocation of credits that the whole industrial world shrank 
 in consequence. The control of the credit of the nation by Wall 
 Street makes it practically impossible to carry through any railway, 
 mining, franchise, or other big project without the consent of those 
 who control the situation. 
 
62 PRIVILEGE AND DEMOCRACY 
 
 can the smallest industry or the Western farmer. It 
 can depreciate the price of government bonds oi 
 embarrass a transcontinental railway system. This 
 monetary syndicate can win favor by its favors, or 
 wreak vengeance on those who oppose it. The sav- 
 ings of the people, deposited with their local bank- 
 ers for safe keeping, have thus become the basis of 
 financial transactions the most stupendous the world 
 has ever known. They exceed in size the financing 
 of a great modern war. Penny by penny, and dollar 
 by dollar, the savings of 80,000,000 people have been 
 lodged in the hands of a few men, related by social 
 and business ties, perfectly understanding one an- 
 other, and bent upon the same common purpose. 
 
 It is for the use of these savings that the Titans of 
 finance go to war. It was to control the premiums 
 and reserves of the insurance companies that men 
 paid millions for these properties. For the deposits 
 are controlled by the directors and trustees. They 
 can loan or invest them as they wish. The prices of 
 securities are put up or down as the will of the syn- 
 dicate dictates. Through this control of the ready 
 money of America the stock market is manipulated. 
 
 The community of interest which has hereto- 
 fore existed among the larger financial interests of 
 New York has recently been converted into actual 
 ownership by two single groups. These are the 
 Morgan and the Standard Oil. The "money monop- 
 oly" has become a reality. Late in 1909 Wall Street 
 
THE TOOLS OF PRIVILEGE 63 
 
 announced the acquisition by these two groups of 
 two of the largest insurance companies, as well as of 
 a number of the largest banks in New York and the 
 West. Six persons were named, under whose con- 
 trol financial institutions had passed, with capital, 
 surplus, and reserves amounting to over a billion 
 and a half of dollars. Nobody knows the institu- 
 tions controlled outside of the metropolis, but they 
 include not only those of the larger but of the smaller 
 inland cities as well. It is not too much to say that 
 the banking resources and credit of the country are 
 largely, if not almost wholly, within the control 
 of the Standard Oil and Morgan interests. 
 
 This is by far the most portentous fact that could 
 confront any people. The life of the modern world 
 is a financial life. It is carried on by banking and 
 credit transactions. Those transactions have fallen 
 under the dominion of a group of men, who could be 
 enumerated on the fingers of one hand. Through 
 the direct and indirect control of the banks and 
 trust companies of America, all business, all com- 
 merce, all transportation, all of the necessities of 
 life, have become subject to their dominion. The 
 daily, weekly, and monthly press must seek their 
 loans from this syndicate. Competing industry 
 must go to it for the right to live. The politics of 
 city, state, and nation are already largely fashioned 
 by its will. Some conception of the extent of its 
 ramifications in the field of industry may be seen 
 
64 PRIVILEGE AND DEMOCRACY 
 
 from the fact that prior to the mergers above re- 
 ferred to "the directors of the National City Bank, 
 the head of the Standard Oil group, and of the Na- 
 tional Bank of Commerce, the head of the Morgan 
 group, hold over a thousand directorships in trans- 
 portation, industrial, and other commercial corpora- 
 tions."' By means of the financial resources in 
 their hands the railways and industries of the country 
 were brought under monopoly control in the closing 
 years of the last century. Dr. Wm. A. Scott, pro- 
 fessor of political economy at the University of 
 Wisconsin, describes the extent to which this has 
 already gone. He says : 
 
 "The Morgan, Vanderbilt, Pennsylvania, Gould- 
 Rockefeller, Harriman - Kuhn - Loeb, and Moore 
 groups, and their more recent successors, represent 
 the achievements of high finance in this field, and 
 great achievements they have been, involving the 
 bringing together under the management of less than 
 seven groups of financiers nearly 2,000 railroad cor- 
 porations, representing more than 200,000 miles 
 of track and a capitalization of about thirteen billions 
 of dollars. (Moody's The Truth about the Trusts.) 
 
 "In the industrial field the achievements of high 
 finance have been scarcely less remarkable. By 
 January 1, 1904, seven great industrial trusts had been 
 developed, controlling 1,528 plants with a capitaliza- 
 tion of more than two and a half billion dollars, and 
 298 lesser industrial trusts, controlling more than 
 3,000 plants, capitalized at over four billion dollars. 
 By January 1, 1908, the great trusts controlled over 
 
 ' A Decade of High Finance, p. 7, by W. A. Scott, Ph.D. 
 
THE TOOLS OF PRIVILEGE 65 
 
 1,600 plants capitalized at nearly three billions of 
 dollars, and the lesser ones over 5,000 plants cap- 
 italized at over eight billions of dollars. To these 
 should be added the so-called franchise trusts, con- 
 trolling about 2,500 plants capitalized at over seven 
 and a half billions of dollars." ^ 
 
 Control of the banking resources and through 
 them of the stock market has been the means by 
 which the control of industries has been brought 
 about. Through this control the cost of living and 
 the material well-being of the people are influenced. 
 
 "The Standard Oil and Morgan federations have 
 well-nigh attained such control. Through the di- 
 rectorate of groups of railroad and industrial cor- 
 porations they are able almost at will to increase or 
 decrease the earning power now of this enterprise 
 now of that. . . . Through reorganization schemes 
 they can water the stock of a concern until even 
 huge earnings yield only insignificant dividends. 
 Being themselves possessed of great wealth and 
 holding large blocks of securities, they can place so 
 much pressure on either the supply or demand side i 
 of the market as to force prices in the direction de- 
 sired. Through their control of great banks and 
 trust companies they may increase or diminish the 
 amount of funds available for investment and specu- 
 lation." == 
 
 Upon the savings of the people, gathered together 
 
 like the rivulets which gradually grow into a mighty 
 
 stream, has been erected a financial feudalism which 
 
 is gradually absorbing to itself the industrial wealth 
 
 » A Decade of High Finance, p. 7, by W. A. Scott, Ph.D. 
 " Idem, p. 21. 
 
66 PRIVILEGE AND DEMOCRACY 
 
 of America. In the transactions of the directors of 
 these financial institutions there is no breach of trust. 
 No wrong thing has been done in the use of the coun- 
 try's credit. But the result has been the complete 
 subjection of the American people to a power, 
 whose ruthlessness or generosity is only a matter of 
 the wish of those who control the system. Through 
 the control of these funds, railroads, mines, indus- 
 tries, and franchise corporations have been taken over. 
 Syndicates are formed among the banking interests. 
 They make loans to themselves of other people's 
 money. Competing properties are purchased. When 
 ownership is secured the properties are consolidated. 
 Securities are then watered. These in turn are sold 
 to the people whose money has been used to effect 
 the monopoly. No new wealth has come into being 
 in the process. Nothing has been added to the prop- 
 erties. Only the tribute of those who toil has been 
 increased. 
 
 Herein is the machinery by which the wealth of 
 America has been cornered. It was by such meth- 
 ods as these that the great combinations of the last 
 few years have been carried through. By this proc- 
 ess the anthracite coal monopoly came into being. 
 Thus the Steel Trust, with its billion and a half of 
 securities, was fastened upon the American people. 
 By these means the beef, the sugar, the tobacco, the 
 copper, and many other trusts were created. Ac- 
 cording to the census enumeration of 1900 the wealth 
 
THE TOOLS OF PRIVILEGE 67 
 
 of America was $94,300,000,000. At the same time 
 there were over 440 industrial franchise and transpor- 
 tation monopolies with a total capital of $20,379,162,- 
 000, or more than one-fifth of the total census wealth 
 of America. Most of these combinations had come 
 into existence in the preceding half-dozen years. 
 
 Only surviving exceptions give reality to the 
 banking business as described in the books, just as 
 surviving examples of independent coal, iron-ore, 
 sugar, and meat producers give reality to the com- 
 petitive principles of economic science. To such an 
 extent is the credit of America being used for spec- 
 ulative purposes, for the upbuilding of monopoly 
 interests through pools, corners, and syndicates, that 
 the producing industry of the nation is being starved. 
 Money needed for local industry is being used in Wall 
 Street for purposes of speculation. When call loans 
 command in the East from ten to thirty per cent., 
 banks will not make time loans to their local cus- 
 tomers at six per cent. For money flows to the point 
 of highest return almost as readily as water flows to 
 its lowest level. 
 
 This is the lamp of Aladdin by which the resources 
 of America have been cornered. The stock exchange 
 is the tool of these money interests. Prices are made 
 at will. So is the news which the speculative world 
 reads with avidity. Day by day the presses are kept 
 busy printing certificates of servitude upon the peo- 
 ple. They cost no more than the greenbacks issued 
 
68 PRIVILEGE AND DEMOCRACY 
 
 by the government during the Civil War. But they 
 are far more costly. The Treasury notes were issued 
 for labor. And labor could and did retire them. 
 But the inflated securities of monopoly are mort- 
 gages in perpetuity upon the labor of mankind. 
 
 Even without these tools monopoly would have 
 appeared. It would have been a slower process. 
 The laws of the land make monopoly inevitable. 
 For monopoly is not due to illegal combinations in 
 restraint of trade. Nor is it due to the skill, talent, 
 or great ability of the master-minds of industry. 
 Monopoly is created by law. It is born of law-made 
 privilege. It is not the law-breaker who is at fault, 
 it is the law-maker. The menacing monopolies which 
 have come into being are almost without excep- 
 tion traceable to four sources. The chief of these is 
 the monopoly of the land. To this are traceable the 
 coal and the iron, the oil and the copper, the gas and 
 the timber monopolies. It is the monopoly of the 
 iron ore and coking coal that has given the Steel 
 Trust the control of the markets of America. The 
 same is true of the copper and the anthracite and bi- 
 tuminous coal monopolies. It is true of the oil and 
 the gas. It is not the wells, the refineries, or the 
 furnaces, it is the control of the raw materials that 
 lies at the root of these monster combinations. 
 
 The second great source of monopoly is the private 
 ownership of the highways of the nation. The rail- 
 ways are natural monopolies, and the coal, oil, iron, 
 
THE TOOLS OF PRIVILEGE 69 
 
 and steel combinations are affiliated with them. In 
 many instances the ownership is identical. The oil 
 monopoly was born of this intimacy, while the beef, 
 the packing, the warehousing, and scores of minor 
 monopolies have had their inception and continue 
 their control of the market by the ownership of 
 private car lines, by ingenious preferential rates, by 
 privileges of countless kinds which are only possible 
 through the joint control of the railways and the in- 
 dustry itself. 
 
 The third great privilege is that of taxation. The 
 tariff is the mother of many trusts. It shields many 
 others which are identified with the railways and the 
 land. In this class are the sugar and the tobacco, 
 the leather and the woollen, the harvester and the 
 cotton, the iron, steel, copper, lumber, paper, and 
 many other combinations. 
 
 The fourth source of monopoly is the direct action 
 of the government itself in the creation of exclusive 
 grants, of which the franchises of our cities are the 
 chief. The rights of way which they occupy are 
 exclusive. There is no possibility of competition. 
 The laws have been drafted by the privileged classes. 
 Once granted, franchises cannot be amended or re- 
 pealed. Upon these franchises billions of securities 
 have been issued, upon which excessive rates and 
 charges are fixed. 
 
 Nine-tenths of the monopolies of to-day are the 
 children of our own creation. They have arisen 
 
70 PRIVILEGE AND DEMOCRACY 
 
 through no violation of the law. They have been 
 invited by the law itself. 
 
 Almost without exception they are identified with 
 the land, or are buttressed by some legislative act, 
 which gives them a monopoly of the market or of the 
 service which they render. The law itself offers a 
 sheltering arm to monopoly from the competition 
 which lies at the life of other business. And the wa- 
 tered securities which spread like a mortgage upon 
 the people of America represent no labor on the part 
 of those who issued them. No new wealth has come 
 into existence through this addition of billions of se- 
 curities to these corporations. Monopoly does not 
 make the grass to grow, or the wheels of industry to 
 turn. Far from stimulating production, monopoly 
 causes production to die. For monopoly means 
 scarcity. It reduces the output of field and factory, 
 and erects a barrier about the nation by means of a 
 tariff wall for the purpose of limiting the supply of 
 wealth. 
 
 Yet, while no wealth has come into being by this 
 process, those who labor are the poorer by reason of 
 it. It cannot be otherwise. The dividends of priv- 
 ilege can only mean cold, hunger, and want for the 
 millions, just as they mean idle luxury for the few. 
 This is the meaning of monopoly; this is part of the 
 cost of the private ownership of the highways and 
 the resources of the earth. 
 
CHAPTER VI 
 THE NEW SERFDOM 
 
 Along with the enclosure of the land there has 
 gone an increase in tenancy as well as in the size of 
 farm holdings. The free home-owner is diminishing 
 in comparison with the tenant, while the small farm 
 is being overshadowed by the large estate. These 
 movements are already well under way. They 
 characterize the East as well as the West. The 
 rapidity of the change is startling. We are fast be- 
 coming a nation of tenants, and from now on the 
 movement will in all probability continue at an 
 accelerated pace. 
 
 Conclusive proof of the increase in tenancy ap- 
 pears from the reports of the United States Census. 
 It is evident in agricultural as it is in urban homes. 
 In the year 1880 the number of farms operated by 
 owners was 74.5 per cent, of the total. This was in 
 the midst of the flood tide of Western migration, 
 when the country was recovering from the de- 
 pression of the previous decade. The homestead 
 law was calling to the West the dispossessed of 
 all the world. Here was land in abundance, which 
 the nation and the states desired only to see appro- 
 priated. 
 
 71 
 
72 PRIVILEGE AND DEMOCRACY 
 
 By 1890 the number of farms operated by owners 
 had diminished to 71.6 per cent, of the total. Dur- 
 ing the decade from 1890 to 1900, a decade coinci- 
 dent with another period of industrial depression and 
 recovery, the decline in farm ownership amounted to 
 a rush. By the close of the century the percentage 
 of farm ownership had fallen to 64.7 per cent, of the 
 total. 
 
 In the twenty years from 1880 to 1900 cash ten- 
 ants increased from 8 per cent, to 13.1 per cent, 
 of the total, while share tenants increased from 
 17.5 per cent, to 22.2 per cent. The increase in 
 the cash tenants was even more marked than the 
 increase in the number of tenants with an interest 
 in the soil.' 
 
 An increase in tenancy may be expected in any 
 growing country. The increase in population makes 
 it inevitable. But that tenancy in America should 
 have increased with such rapidity is startling. And 
 the census enumerators have given the most favor- 
 able construction possible to the returns. They 
 have included as "owners" all those who were "part 
 owners" as well as those who were "owners and ten- 
 ants " and "managers. " They have helped the pros- 
 
 ' The distribution of farm ownership during these years, accord- 
 ing to the census of 1900 (Vol. V, Twelfth Census), is as follows : 
 
 Year Owners Gash Tenants Share Tenants 
 
 1880 74.5 per cent. 8 per cent. 17.5 per cent. 
 
 1890 71.6 per cent. 10 per cent. 18.4 per cent. 
 
 1900 64.7 per cent. 13.1 per cent. 22.2 per cent. 
 
THE NEW SERFDOM 73 
 
 perity theory as much as statistical license would 
 permit. For this reason the census showing of farm 
 ownership is much more favorable than the real con- 
 ditions warrant. For in 1900 only 54.9 per cent, 
 of all the farms were operated by full owners, while 
 45.1 per cent, were in the hands of tenants, or ten- 
 ants with some sort of interest or ownership in the 
 soil. 
 
 Startling as is the extent of tenancy, the ratio 
 with which it has increased during the past twenty 
 years is far more startling. From 1880 to 1900 the 
 number of farms of all forms of tenure increased 
 from 4,008,907 to 5,739,657, or an increase in farms 
 under cultivation of 1,730,750. The farms operated 
 by owners increased 729,065, or 24.4 per cent. ; the 
 farms operated by cash tenants increased from 
 322,357 to 752,920, a gain of 430,563, or 133.6 per 
 cent.; while the farms operated by share tenants 
 increased from 702,244 to 1,273,366, a gain of 
 571,122, or 81.3 per cent. The percentage of in- 
 crease in cash tenancy was five and one-half times 
 the percentage of increase of ownership, while the 
 percentage of increase in share tenancy was nearly 
 three and one-half times as much as the percentage 
 of increase in ownership. 
 
 Year by year, and decade by decade, the loss in 
 farm ownership has continued. It is not confined 
 to any one section or to any form of agriculture. 
 The relative number of owners has everywhere de- 
 
74 PRIVILEGE AND DEMOCRACY 
 
 creased, while the relative number of tenants has 
 everywhere increased. 
 
 When the acreage involved in various kinds of oc- 
 cupancy is considered, the extent in the decline of 
 ownership is even more discouraging. By the close 
 of the century exactly one-half of the acreage of 
 farming land had passed under tenant or qualified 
 owner occupancy. Of the 841,201,546 acres of land 
 under cultivation, 422,354,923 acres were in the 
 hands of "owners." The other half was operated 
 by "tenants," "part owners," or "owners and ten- 
 ants, " and "managers. " And even if we include as 
 "owned" all farms except those operated by cash 
 and share tenants, the area of the lands cultivated by 
 pure tenants amounted to 195,072,457 acres, repre- 
 senting a value of $4,750,888,795.' 
 
 This decline in the percentage of home-owners is 
 just beginning. The next generation will see an 
 even more rapid change in this direction. The 
 growth of population will, of itself, produce this re- 
 sult. For the area of America cannot be increased. 
 The exactions of the railways, of the meat-packers, 
 of the elevators, the warehousemen, and stock yards 
 will promote the tendency still more. A period of 
 hard times, involving an increase in mortgage in- 
 debtedness, will still further stimulate it, so that from 
 this time on a relative decrease of farm ownership 
 may be expected. 
 
 'Twelfth Census, Vol. V. 
 
THE NEW SERFDOM 75 
 
 This growth of tenancy has been accompanied with 
 a steady increase in the size of farms. During the 
 fifty years from 1850 to 1900 the farm land under 
 cultivation increased from 293,560,614 to 841,201,- 
 546 acres. The census enumerators have claimed 
 that the statistics indicated a decrease in the size of 
 farms in recent years. But comparisons have been 
 made with the returns of the year 1850 before the 
 West was opened up to settlement. If we take the 
 census of 1880 for comparison, it appears that the 
 average size of farms has increased from 133.7 acres 
 in 1880, to 146.6 acres in 1900. And while some- 
 thing more than one-half of the total number of 
 farms are still under 100 acres in extent, it is the 
 total acreage held in large and small farms that 
 indicates the tendency. Of the total area under 
 cultivation, 200,324,045 acres, or one-fourth of the 
 total, are in farms of 1,000 acres and over. In 
 twenty years' time the number of farms in this 
 class has increased from 28,578 to 47,276, while 
 the average size of these farms of over 1,000 
 acres is now 4,237 acres. In other words, twenty- 
 five per cent, of the farm acreage of America is 
 held by the insignificant fraction of .0006 of the 
 people. There can be but little comfort in a 
 division of the continent under which less than 
 50,000 persons own 200,000,000 acres, an area far 
 greater than that of either France or Germany, 
 and almost exactly equal to the combined acreage 
 
76 PRIVILEGE AND DEMOCRACY 
 
 of Germany and the United Kingdom, with their 
 population of 100,000,000 souls/ 
 
 Upon this imperial domain, a hierarchy of owners 
 and laborers, of landlords and of tenants, has arisen 
 not unlike the feudal order. Had an intelligent fore- 
 sight guided the distribution of the public land, from 
 ten to twenty million people might have been homed 
 on this area with farms of fifty acres each. Twice 
 that number could have produced a more comfort- 
 able living than many city workers now enjoy. 
 Towns and cities would have arisen and industries 
 would have been called into existence employing 
 millions of other workers. There would have been 
 social and political freedom, for freedom is always 
 stimulated by home ownership. 
 
 It has been suggested that this increase in tenancy 
 may be a good rather than a bad thing. Tenancy, 
 it is claimed, may mean that the wage-earner is being 
 called back from the city to the country; that the 
 blacks of the South are taking up small patches of 
 ground formerly worked on the plantation system, 
 and that farmers who have acquired a competence 
 are leaving the country for the cities, the better to 
 
 ' In addition to these great estates the Census of 1900 shows that 
 103,289,564 acres are held in farms whose average size is 210.8 
 acres; 129,686,228 acres are held in farms whose average size is 
 343.1 acres, and 67,878,349 acres held in farms whose average size 
 is 661.9 acres. Taking the country as a whole 501,186,000 acres are 
 in farms whose average size exceeded 200 acres. Only 340,000,000 
 acres of the 841,201,546 acres under cultivation were in farms of less 
 size than the homesteads allotted by the government. 
 
THE NEW SERFDOM 77 
 
 educate their children, or to pass the declining years 
 of their life in comfort.' 
 
 That the negro should be his own hand rather than 
 another's; that the farmer should go to the city to 
 educate his children; that the wage-earner should 
 leave the shop for the fuller opportunity of the coun- 
 tryside — that all these changes may make for eco- 
 nomic improvement and well-being of these classes 
 is true. But that tenancy on the part of the farm 
 hand, the wage-earner, or the negro is a good thing 
 for any one but for him who partakes of another 
 man's labor, it is difficult to believe. For that is 
 what tenancy means. It always means that some 
 one must labor in order that another may be idle. 
 And the more industrious the tenant, the greater 
 the productivity of his labor, the greater the de- 
 mand for land by those out of work, the higher will 
 
 ' This is suggested by the Director of the Census. Commenting on 
 the increase in tenancy which the last census indicated, he said: 
 "A change of the same essential character took place between 1880 
 and 1890 in each of the five geographic divisions. The relative 
 number of owners everywhere decreased and that of cash and share 
 tenants increased, the share tenants in a less degree than the cash 
 tenants. The change in this character which took place in the dec- 
 ade 1880 to 1890 attracted great attention. It was taken for 
 granted almost universally that the number of tenants was increas' 
 ing at the expense of the number of the owners, and that the move- 
 ment expressed by the increase of tenancy was an ill omen for 
 the republic. That there is another way of viewing the changes 
 here recorded, and that in some respects the popular conclusion over- 
 looks some very important social facts, is evidenced by the point 
 brought out in the discussion of the facts of Tables LXV and LXVI 
 that the farms operated by owners have increased faster since 1850 
 than the agricultural population. Such an increase can only be pos- 
 
78 PRIVILEGE AND DEMOCRACY 
 
 be the rent which must be paid. This is inevitable. 
 It is the testimony of all experience. Tenancy al- 
 ways means labor for privilege, economic subordi- 
 nation for freedom. It can mean nothing else. 
 
 Thus far we have been discussing farm tenancy 
 only. The growth of tenancy is even more marked 
 in urban communities than in the country. In the 
 larger cities the home-owner is rapidly disappearing. 
 Taking the country as a whole, and including urban 
 as well as agricultural homes, only 4,739,914 of the 
 16,006,437 homes, or 29 per cent, of the total, are 
 owned by their occupiers free from encumbrance, 
 while considerably less than half hold title-deeds at 
 all.* In the Eastern cities tenancy is all but uni- 
 versal. In New York city the hired homes amount 
 to 87.9 per cent, of the total. In the boroughs 
 of Manhattan and the Bronx the percentage of 
 tenants rises to 94.1 per cent. In the cities of Bos- 
 
 eible provided the increase in the number of tenants has been by the 
 
 elevation of former wage employees to the position of farm tenants. 
 
 Such an increase in the number of tenants has been by recruits from 
 
 the ranks of wage employees, and not from farm owners or their 
 
 children. The class of owners has increased faster than the portion 
 
 of the families of former owners who have remained on the farms. 
 
 The same is true of the tenant class. . . . This marked decrease 
 
 clearly indicates that the gain in the number of farm tenants has 
 
 been due to recruits drawn from the ranks of wage laborers and not 
 
 from the ranks of farm owners." — Twelfth Census of the United 
 
 States, Vol. V, p. Ixxvii. 
 
 'Distribution of homes in the United States in 1900: 
 
 Homes owned. Homes owned, Tin™„» .»»t„j 
 
 free but mortgaged Homes rented 
 
 4,739,914 2,180,229 8,246,747 
 
 —Twelfth Census, Vol. II, p. 662. 
 
THE NEW SERFDOM 79 
 
 ton, Brookljm, Fall River, Jersey City, and Memphis 
 more than four-fifths of the population live in rented 
 homes. In the city of Buffalo the percentage of 
 homes owned by the occupiers free from mortgage 
 fell from 21.1 per cent, in 1880 to 15.8 per cent, in 
 1900. In Milwaukee a similar loss is shown, while in 
 St. Paul, one of the new cities of the West, the loss in 
 mortgage-free homes was 25 per cent, in the decade. 
 Speaking generally, there was a larger proportion of 
 homes encumbered in 1900 than in 1890. In Man- 
 hattan Borough out of 383,726 homes only 15,361 
 were owned by their occupants; while of these only 
 6,305 are owned by the occupants free from mortgage 
 or other encumbrance. Taking the tenure of thirty- 
 eight leading cities of the United States, we find the 
 distribution to be as follows: 
 
 HOMES OWNED, OWNED, RENTFn 
 
 FREE MORTGAGED ac.ai.r.u 
 
 347,005 306,505 2,259,304 
 
 This loss in home ownership is not confined to any 
 one section of the country. It characterizes Massa- 
 chusetts as well as California; it appears in Kansas 
 as well as in Florida. Out of a total aggregate of 
 613,659 homes in Massachusetts but 207,579 are 
 owned by their occupiers, and of these only 109,494 
 are free from encumbrance. The remainder are hired 
 or held subject to mortgage. In Pennsylvania out 
 of 1,320,025 aggregate homes but 328,989 are owned 
 free, or one-fourth of the total. In Kansas, a state 
 
80 PRIVILEGE AND DEMOCRACY 
 
 of generous fertility, new conditions, and widely 
 heralded recent prosperity, but one home out of three 
 is owned free, and less than 60 per cent, are owned 
 at all by those who occupy them.' 
 
 As is to be expected, the newer states show a 
 larger percentage of ownership than do the older 
 commonwealths. Free home ownership is lowest 
 in the north Atlantic division of states, being only 
 22.3 per cent. It rises in the north central division 
 to 35.3 per cent., while the western division shows a 
 still further increase to 42.7 per cent. Free ownership 
 is lowest in New Jersey, the District of Columbia, 
 Massachusetts, and New York. It is highest in the 
 far Western territories, rising to 80.5 per cent, in 
 Alaska, 66.9 per cent, in New Mexico, and but little 
 less in Oklahoma, Idaho, and Utah. 
 
 It is apparent that we are rapidly becoming a 
 homeless people, differing only in degree from the 
 tenants of Ireland and England, of Russia and 
 Germany, of Spain and Italy. No constitutions or 
 bills of rights can protect us from the operation of 
 economic laws; no guarantee of personal liberty will 
 
 ' The following table of states taken from the Twelfth Census, 
 Vol. II, indicates the conditions of home ownership in 1900: 
 
 
 
 
 Homes owned. 
 
 
 Total homes. 
 
 Total homea, 
 
 free f kom 
 
 
 owned 
 
 hired 
 
 encumbrance 
 
 Massachusetts . 
 
 . . 207,579 
 
 385,959 
 
 109,494 
 
 New York . . 
 
 . . 528,152 
 
 1,061,267 
 
 280,673 
 
 Ohio .... 
 
 . . 484,142 
 
 437,618 
 
 318,553 
 
 Nebraska . . 
 
 . . 121,465 
 
 92,479 
 
 71,617 
 
 Kansas . . . 
 
 . . 184,150 
 
 127,565 
 
 117,351 
 
 Georgia . . . 
 
 . . 130,205 
 
 294,830 
 
 101,494 
 
THE NEW SERFDOM 81 
 
 avail against the relationship of landlord and tenant 
 so long as the land is subject to private monopoly. 
 Already one-half of the people of America are tenants. 
 The growth of population will increase their number. 
 Future generations will have no alternative but to 
 pay the price which is demanded by those who own 
 the soil. This tribute will increase with each on- 
 coming generation. From now on the father of a 
 family will look forward, not to increasing oppor- 
 tunity for his children, but to an ever-increasing 
 burden to be paid to those who own the land. 
 
 This tendency will be further stimulated by other 
 causes. Up to the present time,, the franchises of 
 our cities, the financing of railways and transporta- 
 tion agencies, the exploitation of the mineral re- 
 sources have offered the most inviting fields for 
 capital. Here returns were most immediate. But 
 the transportation agencies have been consolidated, 
 the mining opportunities have been appropriated, 
 the land has been denuded of its forests, and the 
 cities despoiled of their franchises. The develop- 
 ment of the future will be in the line of further con- 
 solidation or the perfection of operation. More- 
 over, so long as free land existed in the West, agri- 
 cultural land was of little value. Rent was slow 
 to rise. Men would not willingly work for another 
 when they could work for themselves. But the vir- 
 gin prairies are now enclosed. Future generations 
 must find their homes on land already appropri- 
 
82 PRIVILEGE AND DEMOCRACY 
 
 ated. This will stimulate agricultural rent. This 
 is already apparent. It has been remarked by the 
 Census Office and the Agricultural Department, which 
 report a tremendous increase in land values in the 
 last few years. The millions of dividends which 
 are pouring into the money centres will now find 
 their way into land speculation. For land is the 
 safest of all investments, and capitalistic agriculture 
 is profitable. Moreover, land has become a monop- 
 oly, a monopoly not yet so complete as other indus- 
 tries, but none the less a monopoly. From now on, 
 therefore, we may expect increasing investments in 
 land and a constant growth in the plantation system. 
 This change marks a revolution in the economic 
 foundations of American society. It is the most 
 revolutionary change that could be imagined. For 
 the universal opportunity which for three centuries 
 America offered to all the world has finally come to 
 an end. 
 
CHAPTER VII 
 SOME OF THE COSTS OF TENANCY 
 
 Agkicultukal tenancy is more precarious in 
 America than in any country in Europe. Tenure is 
 subject to the arbitrary will of the owner. There 
 is nothing to check the operation of the law of de- 
 mand and supply, nothing to protect the tenant in 
 his occupancy. In many of the countries of Europe 
 the traditions of feudalism have softened the rela- 
 tions of landlord and tenant. Competition has been 
 mitigated by the long-continued occupancy of the 
 land by certain families. The hand of the landlord 
 is restrained by this fact. In some countries rents 
 have remained fixed during long periods of time. 
 Custom has established a fair rent. It may not be 
 changed except by agreement with the tenant. 
 
 In Ireland an attempt has been made to re- 
 establish by statute the idea of customary rents, to 
 give security to the tenant, to indemnify him for his 
 improvements, and to protect him from the landlord. 
 Tribunals have been created with power to fix rents 
 at a reasonable rather than a competitive figure. 
 Provision is also made for the compulsory purchase 
 of land, and its resale to the peasants on instalments, 
 with the aim of creating a peasant proprietary class. 
 
 83 
 
84 PRIVILEGE AND DEMOCRACY 
 
 More recently similar legislation has been passed for 
 England, by the aid of which the local authorities 
 may acquire land in large areas and subdivide it 
 among petty proprietors. 
 
 In America there is no such custom, no such tra- 
 dition of the personal relations of feudalism, no such 
 legislation to protect the agricultural tenant from the 
 increase of rent. There is nothing to relieve the 
 struggle for existence and the right of the landlord 
 to charge whatsoever he pleases. And it is doubtful 
 if the Constitution would permit any such fair-rent 
 legislation. The landlord can dismiss the tenant at 
 will, he can and does appropriate all of the im- 
 provements which have been made. The tenant 
 has no right to anything which has become fixed 
 to the realty. He may take away the crops, but 
 nothing more. All of the betterments pass to the 
 landlord. 
 
 In consequence the tenant does nothing to im- 
 prove the land. He makes no repairs. He culti- 
 vates for the present only, he selects such crops as 
 will give an immediate return with the least possible 
 labor. He permits the buildings and improvements 
 to go to decay; he exhausts the land itself by failing 
 to fertilize it. In time he abandons the property 
 because it is no longer profitable. 
 
 The same influences lead to indifferent cultivation. 
 The stimulus of security is absent. The tenant is 
 wasteful and careless. His rent is fixed by what the 
 
SOME OF THE COSTS OF TENANCY 85 
 
 land is supposed to yield; it is determined by what 
 another will pay for the same holding. If he in- 
 creases its fertility, it is made an excuse for an 
 increase in the rent. If he is thrifty and indus- 
 trious, if he makes the farm more attractive, if 
 he drains and irrigates it, the advantage accrues 
 to the owner or to some other tenant who will 
 offer an increased rent for the property because 
 of his exertions. 
 
 Agricultural land in America is usually rented 
 from year to year. The tenant is subject to eviction 
 upon a few months' notice. He has not even the 
 security of a long-time grant. There is nothing to 
 stimulate his pride, nothing to awaken his interest. 
 Every incentive is lacking. Competitive tenancy, 
 such as everywhere exists in America, is utterly de- 
 structive to good farming; it leads to indifference 
 on the part of the worker, and a rapid deterioration 
 in the farm itself. 
 
 These conditions are already common in many 
 parts of the country. The tenant farm, with its 
 dilapidated buildings, with barns and fences going 
 to decay, with fields badly cultivated or grown up 
 with weeds, may be seen in any section of the East. 
 The tenant farmer is but little better off than the 
 worker in the city; he can rarely accumulate any 
 capital or make any provision for the morrow. He 
 has little more security in his position than the farm 
 laborer. 
 
86 PRIVILEGE AND DEMOCRACY 
 
 The Public Lands Commission, appointed by Pres- 
 ident Roosevelt, has described in very moderate 
 language the extent and effect of tenancy in the 
 West. The report says: 
 
 "The disastrous effect of this system [of tenant cul- 
 tivation] upon the well-being of the nation as a whole 
 requires little comment. Under the present condi- 
 tions, speaking broadly, the large estates usually re- 
 main in a low condition of cultivation, whereas under 
 actual settlement by individual home-makers, the 
 same land would have supported many families in 
 comfort, and would have jdelded far greater returns. 
 Agriculture is a pursuit of which it may be asserted 
 absolutely, that it rarely reaches its best develop- 
 ment under any concentrated form of ownership. 
 
 "There exists and is spreading in the West a ten- 
 ant or hired-labor system which not only represents 
 a relatively low industrial development, but whose 
 further extension carries with it a most serious 
 threat. Politically, socially, and economically this 
 system is indefensible. Had the land laws been 
 effective and effectually enforced, its growth would 
 have been impossible. 
 
 "It is often asserted in defence of large holdings 
 that, through the operation of enlightened selfish- 
 ness, the land so held will, eventually, be put to its 
 best use. Whatever theoretical considerations may 
 support this statement, in practice it is almost uni- 
 versally untrue. Hired labor on the farm cannot 
 compete with the man who owns and works his land, 
 and if it could, the owners of large tracts rarely have 
 the capital to develop them effectively. 
 
 "Although there is a tendency to subdivide large 
 holdings in the long-run, yet the desire for such 
 
SOME OF THE COSTS OF TENANCY 87 
 
 holdings is so strong and the behef in their rapid in- 
 crease in value so controlling and so widespread, 
 that the speculative motive governs, and men go to 
 extremes before they will subdivide lands which they 
 themselves are not able to utilize. "* 
 
 Bad as these conditions are, they are only begin- 
 ning to appear. Land is still relatively cheap. Popu- 
 lation is still far from dense. The free homestead in 
 the West and the demands of industry have relieved 
 the demand for land. From now on, however, agri- 
 cultural rent is bound to increase. In time compe- 
 tition will be carried to such a point that agriculture 
 will suffer. The worker will not be able to save 
 enough to stock and maintain the farm. He will 
 abandon those crops which require a capital outlay 
 for the coming season, and will limit his planting 
 to those which are most easily harvested. Com- 
 petition will go even further than this. With in- 
 creasing population the worker will offer a greater 
 share of the produce, or a higher rent for the 
 land, than he can produce. He will do this as a 
 means of escape from starvation, or to prevent 
 another, as hungry as himself, from taking the 
 land from him. 
 
 Ireland is the country in whose history we can 
 best study the results of competitive agricultural 
 tenancy. From her experience we can forecast our 
 own. For here as there no limit existed to the right 
 
 ' Senate Document No. 154, 58th Congress, 3d session, p. 14. 
 
88 PRIVILEGE AND DEMOCRACY 
 
 of the owner to do as he willed with his land. John 
 Stuart Mill has thus described the conditions of com- 
 petitive tenancy in Ireland: 
 
 "It is scarcely possible," he says, "that cottier 
 [competitive tenancy] agriculture should be other 
 than miserable. . . . The competition for land makes 
 the tenants undertake to pay more than it is possible 
 they should pay, and when they have paid all they 
 can, more almost always remains due. 
 
 '"It may fairly be said of the Irish peasantry,' 
 said Mr. Revans, the secretary of the Irish Poor 
 Law Enquiry Commission, 'that . . . the rents 
 which they promise, they are almost invariably in- 
 capable of paying; and, consequently, they become 
 indebted to those under whom they hold, almost as 
 soon as they take possession. They give up in the 
 shape of rent the whole produce of the land, with the 
 exception of a sufficiency of potatoes for a subsist- 
 ence; but as this is rarely equal to the promised rent, 
 they constantly have against them an increasing 
 balance. In some cases, the largest quantity of 
 produce which their holdings ever yielded, or which, 
 under their system of tillage, they could, in the most 
 favorable seasons, be made to yield, would not be 
 equal to the rent bid; consequently, if the peasant 
 fulfilled his engagement with his landlord, which he is 
 rarely able to accomplish, he would till the ground 
 for nothing, and give his landlord a premium for 
 being allowed to till it. . . . The full amount of the 
 rent bid, however, is rarely paid. The peasant re- 
 mains constantly in debt to his landlord; his mis- 
 erable possessions — the wretched clothing of himself 
 and of his family, the two or three stools, and the few 
 pieces of crockery which his wretched hovel contains 
 would not, if sold, liquidate the standing and gener- 
 
SOME OF THE COSTS OF TENANCY 89 
 
 ally accumulating debt. . . . Should the produce of 
 the holding, in any year, be more than usually abun- 
 dant, or should the peasant, by any accident, be- 
 come possessed of any property, his comforts cannot 
 be increased; he cannot indulge in better food nor 
 in a greater quantity of it. His furniture cannot be 
 increased, neither can his wife or children be better 
 clothed. The acquisition must go to the person 
 under whom he holds.' 
 
 "As an extreme instance of the intensity of com- 
 petition for land, and of the monstrous height to 
 which it occasionally forced up the nominal rent, 
 we may cite from the evidence taken by Lord 
 Devon's Commission, a fact attested by Mr. Hurly, 
 clerk of the Crown for Kerry: 'I have known a 
 tenant bid for a farm that I was perfectly well 
 acquainted with, worth £50 a year; I saw the 
 competition get up to such an extent that he was 
 declared the tenant at £450.' 
 
 "In such a condition what can a tenant gain by 
 any amount of industry or prudence, and what lose 
 by any recklessness? If the landlord at any time 
 exerted his full legal rights, the cottier would not be 
 able even to live. If by extra exertion he doubled 
 the produce of his bit of land, or if he prudently ab- 
 stained from producing mouths to eat it up, his only 
 gain would be to have more left to pay to his land- 
 lord; while if he had twenty children they would 
 still be fed first, and the landlord could only take 
 what was left. Almost alone amongst mankind the 
 cottier is in this condition, that he can scarcely be 
 either better or worse off by a'ny act of his own. If 
 he were industrious or prudent, nobody but his land- 
 lord would gain; if he is lazy or intemperate, it is 
 at his landlord's expense. A situation more devoid 
 of motives to either labor or self-command, imagina- 
 
90 PRIVILEGE AND DEMOCRACY 
 
 tion itself cannot conceive. The inducements of free 
 human beings are taken away, and those of a slave 
 not substituted. He has nothing to hope, and noth- 
 ing to fear, except being dispossessed of his holdings, 
 and against this he protects himself by the ultima 
 ratio of a defensive civil war. Rockism and White- 
 boyism were the determination of a people, who 
 had nothing that could be called theirs but a daily 
 meal of the lowest description of food, not to sub- 
 mit to being deprived of that for other people's 
 convenience. 
 
 " Is it not, then, a bitter satire on the mode in which 
 opinions are formed on the most important prob- 
 lems of human nature and life, to find public instruc- 
 tors of the greatest pretensions imputing the back- 
 wardness of Irish industry, and the want of energy in 
 the Irish people in improving their condition, to a 
 peculiar indolence and insoiudance in the Celtic race? 
 Of all vulgar modes of escaping from the considera- 
 tion of the effect of social and moral influences on the 
 human mind, the most vulgar is that of attributing 
 the diversities of conduct and character to inherent 
 natural differences. What race would not be indo- 
 lent and insouciant when things are so arranged 
 that they derive no advantage from forethought or 
 exertion? If such are the arrangements in the midst 
 of which they live and work, what wonder if the 
 listlessness and indifference so engendered are not 
 shaken off the first moment an opportunity offers 
 when exertion would really be of use? ... It speaks 
 nothing against the capacities of industry in human 
 beings that they will not exert themselves without 
 motive. No laborers work harder in England or 
 America than the Irish; but not under a cottier 
 system. " ' 
 
 ' Principles of Political Economy, Bk. II, chap. 9. 
 
SOME OF THE COSTS OF TENANCY 91 
 
 Such are the logical and inevitable results of com- 
 petitive tenancy. The condition of the peasant 
 farmer in England is but little, if any, better than 
 that of the cottier in Ireland. He is subject not 
 only to industrial but political and religious subjec- 
 tion to his landlord. On the Continent the same is 
 true. Much of the land of Belgium is held on short- 
 time leasehold. The tenant has somewhat more se- 
 curity than the Irish cottier, but he is rack-rented 
 nevertheless. Emile de Laveleye, the celebrated 
 Belgian economist, said of the system which prevails 
 in that country: 
 
 "The tenant is not encouraged to improve, and 
 if he does make improvements he can hardly be 
 said to reap the benefits of them. The landlords 
 will not grant longer leases, because they want, in 
 the first place, to keep a hold upon their tenants; 
 and secondly, to raise the rents when the leases 
 expire. It may be said, that throughout Belgium 
 such increases of rent take place regularly and peri- 
 odically."* This process of rent increase is proven 
 by statistics. From all of the provinces of Belgium 
 the average rent per one hundred acres of land 
 increased in thirty-six years from $11.45 per unit 
 to $20.40, or nearly one hundred per cent. Unlike 
 Ireland, Belgium blossoms like the rose. It is won- 
 derfully productive. Yet the population of the 
 
 '"Systems of Land Tenure in Various Countries, " Cofeden Club 
 Essays, p. 466. 
 
92 PRIVILEGE AND DEMOCRACY 
 
 country is the most illiterate, in many ways the most 
 poverty-stricken and miserable, of any in western 
 Europe. "I think it is certain," says Professor 
 Laveleye, "that the Flemish farmer is much more 
 ground down by his landlord than the Irish tenant."* 
 
 One has only to cross the borders into Holland to 
 find an entirely different state of affairs. Holland, 
 like Denmark and Switzerland, is a land of comfort, 
 high degree of education, and happiness. Laveleye 
 says of this country: "The farmers of Holland 
 lead a comfortable, well-to-do, and cheerful life. 
 They are well-housed and excellently clothed. They 
 have chinaware and plate on their sideboards, tons 
 of gold at their notaries, public securities in their 
 safes, and in their stables excellent horses. Their 
 wives are bedecked with splendid corals and gold. 
 They do not work themselves to death. On the ice 
 in winter, and at the Kermesses in summer they en- 
 joy themselves with the zest of men whose minds are 
 free from care."^ 
 
 The reason assigned by M. de Laveleye for the pros- 
 perity of the Dutch farmers in comparison with the 
 Belgian is that the land in Holland has remained al- 
 most entirely in the hands of the peasants, who work 
 their lands for themselves rather than for another. 
 They do not fear an increase in rent with every im- 
 provement in production nor eviction in favor of 
 another willing to offer a higher rent for the land. 
 
 ^Cobden Club Essays, supra, p. 483. *Idem, p. 133. 
 
SOME OF THE COSTS OF TENANCY 93 
 
 It is trae America has not yet reached the condi- 
 tions described in Ireland and Belgium. The ulti- 
 mate results of competitive tenancy have not yet 
 appeared. The free lands of the West have kept 
 down rents. It has offered an outlet for the East. 
 But America already has a large tenant class. The 
 number of renters is bound to increase and increase 
 with great rapidity. This is inevitable. For the 
 land is practically all enclosed and population is in- 
 creasing with no sign of abatement. 
 
 Ultimately, as in Ireland, the operation of the law 
 of demand and supply will reduce the standard of 
 living of the tenant to the lowest point. The sum 
 which men will offer for the use of the land will be 
 determined, just as is the price of a loaf of bread 
 among starving men. Millions in Europe are al- 
 ready offering all save a potato diet for the mere 
 right to work upon another's land. And millions 
 more have promised more than they could possibly 
 produce in order that they might anticipate a hun- 
 gry competitor. It is this struggle for the land that 
 is sending the population of Russia, Hungary, Ger- 
 many, and Italy to America to-day. And it is only a 
 matter of time when the conditions which they have 
 left behind will reappear in their new home. 
 
CHAPTER VIII 
 THE EVOLUTION OF SERFDOM 
 
 History has touched but lightly on the evolution 
 of private property in land. Yet the introduction 
 of this idea and its development into a system of 
 tenure is probably the most important social fact 
 in the history of Christendom. It has moulded 
 modem society. It explains the rise and fall of na- 
 tions. It is the cause of vice, misery, and poverty. 
 In a large view of history the changes which have 
 taken place in the customs and laws of land tenure 
 are of colossal import to society. 
 
 The beginnings of private land ownership in its 
 present form are definite and clear. They are trace- 
 able to the last three centuries of the Roman repub- 
 lic, when the senatorial class appropriated the 
 public lands of Italy to themselves, and converted 
 the free citizens into tenants and slaves through the 
 monopoly of the land and the law of debt. 
 
 During these centuries the Roman law became a 
 completed system. It reflected the economic in- 
 terests of the ruling classes. It sanctioned the ab- 
 solute private ownership of the land and destroyed 
 the early traditions of economic freedom. 
 
 94 
 
THE EVOLUTION OF SERFDOM 95 
 
 Through colonial expansion the plantation system 
 of the later republic was carried to the furthermost 
 corners of Europe. Roman law and Roman legis- 
 lation became the basis of the jurisprudence of a 
 great part of the modern world. It was assimilated 
 into the barbarian codes. It underlies the Code 
 Napoleon, as well as the imperial law of Germany. 
 It was fused into the common law of England. The 
 methods of land tenure of Europe, of the United 
 States and Australasia, all trace their lineage back 
 to the patrician-made laws of the Roman senate, 
 designed to dispossess the Roman people from their 
 common lands. "The Romans were the first," ac- 
 cording to Laveleye, "to establish exclusive individ- 
 ual property in land, and the principles they adopted 
 on this subject still serve as the basis of law for Con- 
 tinental states. " * 
 
 Historians differ as to the sources of the feudal 
 system. It is certain, however, that by the fourth 
 century A. D. most of the land in the empire was in 
 the hands of the senatorial nobility of Rome.^ It 
 was divided into great estates, just as it had been 
 in Italy. The free owner had all but disappeared. 
 The land was worked by colonii, or by serf labor. 
 As the imperial power declined, the plantation own- 
 ers assumed sovereign powers. They acted as mag- 
 istrates and dispensed justice. They collected such 
 
 'Primitive Property, p. 163. 
 
 ^Medieval Civilization, Munro-Sellery, p. 18. 
 
96 PRIVILEGE AND DEMOCRACY 
 
 taxes as were paid, and provided their quota of men 
 in time of war. 
 
 Here was the relation of lord and vassal. Here 
 was the hierarchical organization of society about the 
 manor. When the barbarian hordes settled upon the 
 territory occupied by Roman colonists they found 
 a political, social, and industrial system, which, as 
 years went on, developed into the feudal system. 
 For the Roman, like the feudal, system was based 
 upon the manor. 
 
 The Roman idea of private ownership under the 
 manorial system came into conflict with the German 
 idea of common ownership under the village com- 
 munity. For the barbarians had no conception of 
 the absolute private ownership of the land. Among 
 them the land was owned in common by the village. 
 " The families forming the community had only the 
 right of enjoyment, the ownership of the soil resting 
 in the community itself. " ' The idea that one indi- 
 vidual might appropriate a part of the earth's surface, 
 and do with it as he willed, seems never to have oc- 
 curred to these, or to any other early people. It 
 was not permitted to one person, more aggressive 
 than his neighbors, to become the lord proprietor of 
 an immense estate, and pass it on from generation to 
 generation and from century to century, and ex- 
 clude his fellows from its use. Equality of economic 
 opportunity was the most fundamental, as it was the 
 
 ' Primitive Property, Laveleye, p. 106. 
 
THE EVOLUTION OF SERFDOM 97 
 
 most universal, idea of early society. Like the right 
 to breathe the air and enjoy the sunlight, the land was 
 the common possession of all. It was designed for 
 use, not for ownership. The motive of early society 
 was production. He who would use the land was 
 preferred to him who would not. Each oncoming 
 generation was thus assured an opportunity as full 
 and as free as its predecessor. 
 
 It was the communal ownership of the land that 
 explains the essential democracy of early European 
 peoples, just as it was the free public land of America 
 that lies at the basis of our own democracy. There 
 was little or no hereditary rank among the early 
 Teutons, save that which attached to age or charac- 
 ter. The leader was the first among equals. His 
 authority was the authority of superior ability or 
 wisdom. In the tribal organization every freeman 
 had a voice. This democracy of the Teutonic peoples 
 was economic. It sprang out of the common owner- 
 ship of the soil. It is this that explains the democ- 
 racy and comparative well-being of the people of 
 Switzerland. "In the primitive cantons of Switzer- 
 land," says Laveleye, "institutions of the most 
 democratic character conceivable have secured the 
 inhabitants from the most remote times in the enjoy- 
 ment of liberty, equality, and order, and as great a 
 degree of happiness as is compatible with human 
 destinies. This exceptional good-fortune is attribu- 
 table to the fact that ancient communal institutions 
 
98 PRIVILEGE AND DEMOCRACY 
 
 have been preserved, and with them the primitive 
 communal ownership." ' 
 
 The village community, with its common owner- 
 ship of the land, is one of the most universal insti- 
 tutions of society. Sir Henry Maine says : "It is 
 known to be of immense antiquity. In whatever 
 direction research has been pushed in Indian terri- 
 tory, it has always found the community in exist- 
 ence at the farthest point of its progress. . . . Con- 
 quests and revolutions seem to have swept over it 
 without disturbing or displacing it, and the most 
 beneficent systems of government in India have 
 always been those which have recognized it as a 
 basis of administration." Under it "the personal 
 relations to each other of the men who compose 
 it are indistinguishably confounded with their pro- 
 prietary rights. " ^ The village community is to be 
 found in Russia to-day, where it is said "to be a 
 nearly exact repetition of the Indian community. " ' 
 Research has found this idea of the common owner- 
 ship of the land in Russia, Germany, Great Britain, 
 Ireland, Switzerland, and Scandinavia. It has been 
 found in Java, in Mexico, and in Peru, as well as in 
 New Zealand, India, and Africa. 
 
 In early Britain the same was true. The land of 
 the township belonged to the village. Each free- 
 man had a homestead of his own. This land was 
 
 ' Primitive Property, Laveleye, p. 62. 
 
 'Ancient Law, p. 231. 'Idem, p. 237. 
 
THE EVOLUTION OF SERFDOM 99 
 
 separated from the common stock. Around about 
 the enclosure lay the arable land. It was divided 
 into fields whose use was allotted to the members 
 of the community. These allotments were used for 
 farming, and from seed-time to harvest were under 
 the control of the freemen to whom they had been 
 assigned. There was individual ownership of the 
 crops, but not in the land. After the harvest had 
 been gathered the land was thrown open for pastur- 
 age, to be used by all.* 
 
 Under this system of land tenure rent was un- 
 known. The land belonged to all. That one man 
 should collect tribute from another for the use of that 
 which nature had provided for the community did not 
 enter the imagination of early peoples. It was this 
 sort of industrial democracy that came into conflict 
 with the land laws of Rome. In this conflict the 
 village community of the Germans was destroyed. 
 It was destroyed by the plantation system of the 
 Romans. The Roman landlord became the feudal 
 overlord; the German freeman degenerated into the 
 Latin tenant. Feudalism with its hierarchical organ- 
 ization of classes was the result. Common owner- 
 ship of the land was lost to humanity. 
 
 Such would seem to be the obvious explanation of 
 the origin of feudalism. Such an explanation is con- 
 firmed by the tenacity with which people cling to 
 their ideas of property. And of all laws those re- 
 
 ' The Agricultural Community of the Middle Ages, E. Nasse, p. 10. 
 
100 PRIVILEGE AND DEMOCRACY 
 
 lating to land tenure are the most immutable. Re- 
 ligion and language may be abandoned. Forms 
 of government and the ideals of a people may be 
 altered. But the methods of land tenure persist. 
 They are carried by the emigrant to his new home. 
 They take root when other ideas are abandoned. We 
 see this in the persistence of the common law, which 
 has spread out from England over the whole western 
 world and carried with it the system of English 
 land tenure. 
 
 During the centuries which followed the disinte- 
 gration of the Roman Empire feudalism became a 
 system of organized society. It was, primarily, an 
 economic system. About the system of land tenure 
 the political, religious, and industrial institutions of 
 Europe were erected. The union of lord and vassal 
 was one of mutual service and protection. The 
 tenant bore arms in the time of war. He served 
 the master in time of peace. At the same time the 
 lord engaged to protect the vassal. Both had obli- 
 gations, both had rights. 
 
 But the land was still far from private property. 
 The great baron held his land from the king by the 
 performance of certain duties, just as the lesser 
 vassals held their lands from the baron by similar 
 services. These services, whether military, personal, 
 or servile, were the nexus of society. They were fixed 
 by custom. They were the same as taxes, for the 
 lack of money precluded the existence of any revenue 
 
THE EVOLUTION OF SERFDOM 101 
 
 system. The basis of all relations was the land. 
 This was the economic foundation of the feudal order. 
 All of the activities and relations, whether political, 
 social, or industrial, sprang from this fact. 
 
 The distinguishing thing about the feudal tenure 
 was the joint ownership of the land by the crown, 
 the lord, and the vassal. Neither the one nor the 
 other was the absolute owner. The tenure of the 
 great baron was the same as the vassal's. Along 
 with the Roman ownership of the land by the lord 
 there survived certain Germanic ideas of the common 
 ownership by the people. Every person had to serve 
 some one above him as a condition of his occupancy. 
 Each class had certain fixed rights and obligations. 
 These obligations could not be changed, the services 
 could not be increased, the occupancy of the land 
 could not be taken away, except by agreement. 
 Absolute private ownership of the land, as we un- 
 derstand it, did not obtain. There was a blending of 
 the common ownership of the Germans with the ab- 
 solute ownership of the Romans. It was this that 
 distinguished the land tenure of the Middle Ages 
 from that which preceded it, and from that which we 
 have to-day. 
 
 But this condition did not continue. If it had, the 
 land of Europe would still be jointly held by all the 
 people, subject to certain fixed rents in the form of 
 taxes to the state. The rights of the vassals on the 
 one hand and of the crown on the other were de- 
 
102 PRIVILEGE AND DEMOCRACY 
 
 stroyed. The rights of both were absorbed by the 
 feudal barons, who became the absolute owners of 
 the land, just as they are to-day. The Roman law 
 destroyed the Germanic custom. By the eighteenth 
 century almost all of the land of Europe was held in 
 great estates as exclusive private property. 
 
 This change did not take place in a year or in a 
 generation, but in a series of generations, just as rail- 
 way monopoly in America is the product of an un- 
 conscious evolution covering a long period of time. 
 During the sixteenth and seventeenth centuries the 
 use of money became general. The personal services 
 of the feudal order were converted into money rent. 
 The vassal ceased to pay for his land in service. He 
 now paid in cash. The use of money also made pos- 
 sible the substitution of a paid army for military 
 duties. This absolved the barons from their ser- 
 vices to the crown. The economic framework of so- 
 ciety still centred about the land. But the lord 
 was freed from taxes and services, while the vassal 
 became a competitive cash tenant. 
 
 Modern landlordism had its beginning in these 
 changes. The personal relations of the vassal to the 
 lord as well as of the lord to the king were destroyed. 
 The lords came to treat the land as their own. They 
 lost all sense of obligation to their tenants. As pop- 
 ulation grew, so did the demand for land. The lords 
 substituted competitive rents for services fixed by 
 custom. The freeman lost his security of tenure and 
 
THE EVOLUTION OF SERFDOM 103 
 
 with it his customary though limited ownership of 
 the land. The landlord now charged as much rent 
 as was possible. He was limited only by what an- 
 other would pay for the land. The vassal became 
 a tenant at his will. He might be evicted at the 
 whim or caprice of the owner. He now had to com- 
 pete with his fellows for that which had formerly 
 been partly his own. He gained his personal 
 freedom, but he lost materially by the destruction 
 of his ownership in the land. 
 
 The importance of this change, which reached its 
 culmination in the seventeenth and eighteenth cen- 
 turies, cannot be exaggerated. Through it every 
 vestige of the common or village ownership of the 
 land was destroyed. The free yeoman was reduced 
 to the position of a rack-rented tenant. He could 
 move from place to place, but he could not move oflf 
 from the face of the earth. Instead of the great 
 mass of serfs being raised to freedom, all of the free- 
 men were reduced to the position of tenants. Only 
 the symbols were changed. In many ways modern 
 tenancy is more oppressive than were the custom- 
 ary relations of the Middle Ages.' 
 
 ' Under the feudal regime "the freeman . . . owed nothing to the 
 master; they were dependent upon him only in so far as he was their 
 landlord, only because they lived upon his lands. They were renters 
 or farmers in perpetuity. Their holding was a fragment of the great 
 domain. They cultivated it for their profit, on the condition of pay- 
 ing either a fixed amount, like our farm rents, or a certain part of 
 the produce, as in oiu" farming on shares. In distinction from the 
 renter or farmer of our day, their condition was fixed forever; the land- 
 
104 PRIVILEGE AND DEMOCRACY 
 
 Such is the evolution of the private ownership of 
 the land. Such are the means by which the unpriv- 
 ileged classes were despoiled by their rulers. Such, 
 too, is the origin of rent, the modern equivalent of 
 serfdom. Both private ownership of the land and 
 the payment of rent for its use (aside from the pay- 
 ments of services, which were in reality payments 
 or taxes to the state) are of comparatively recent 
 origin. Landlordism made its way out of feudalism, 
 because the landed classes everywhere controlled the 
 state. Not only the state but the schools and the 
 universities, the bench and the bar, the Church and 
 all of the agencies of public opinion as well. Those 
 who had previously ruled by force now ruled by 
 law. Through law they gave a solemn sanction and 
 respect for their decrees. The idea of obedience was 
 taught by the Church as the first duty of man. 
 
 Private ownership of the land is a product of class 
 legislation, just as is the tariff, just as are the great 
 manorial estates which have been stolen from the 
 public domain in the West, just as are the privileges 
 which have been conferred upon the franchise cor- 
 
 lord could not take back their lands or increase their rent. On the con- 
 dition that they paid the old charges, they were free to dispose of their 
 holding, to bequeath U as they would, to transfer it, even {at least in 
 France) to parcel it out. . . . The difference is that while our fanners 
 have but a precarious position and are in danger of seeing their 
 charges increased at the end of the lease, the tenant of the middle 
 ages enjoyed an assured position, encumbered only with fixed 
 charges. He was consequently in a firmer position, one that was 
 nearer to ownership." — The Feudal Regime, by Charles Seignobos, 
 pp. 13 and 25. 
 
THE EVOLUTION OF SERFDOM 105 
 
 porations and water-power companies of America 
 to-day. The ideas of the private ownership of the 
 land and of rent for its use are merely an evidence 
 of the long-continued control of the governments of 
 Europe by the land-owning classes. They are not 
 an evidence of progress or of reason, of custom or of 
 popular sanction. The genesis of private ownership 
 of lands is to be found in force and in fraud. 
 
CHAPTER IX 
 THE TYRANNY OF THE DEAD 
 
 The feudal system is not yet ended. No more 
 ended than is the idea of kingship in the countries 
 of Europe. No more ended than is the Church. 
 The feudal regime has persisted from the eighteenth 
 century into the twentieth, just as it persisted 
 from the fourteenth century to the fifteenth. It 
 altered its forms in the latter centuries just as it 
 did in the former. The substance has remained the 
 same from the tenth century down to date, only it 
 casts a different shadow. The use of money, the 
 absence of many servile obligations and services, the 
 shifting of the military power from the great nobility 
 to the crown, the substitution of a standing army for 
 personal military service — ^all these have altered the 
 appearance of the feudal relationship. 
 
 But the essence of the feudal system is and ever 
 has been the power of one class to live upon the 
 labor of another class without giving any service in 
 return. The two characteristics of the feudal system 
 have ever been the support of the privileged orders 
 by rent, and the maintenance of the crown by taxes, 
 by the labor of the unprivileged masses. These ob- 
 ligations have ever been the brand of the servile 
 
 106 
 
THE TYRANNY OF THE DEAD 107 
 
 class. All other elements were non-essential. The 
 personal ties, oaths, and obligations which bound 
 the serf, vassal, and overlord were to feudalism what 
 the Thirty-nine Articles are to the Anglican Church. 
 The rendition of service was its esse;ice. It was the 
 three or five days a week labor on the estates of the 
 lord; it was the payment of toll upon the bridges, 
 of tribute at the markets, at the mill, and the wine- 
 press; it was the beating of the marshes at night in 
 order that the sleep of the lord might not be dis- 
 turbed, by the frogs — ^it was these things that feudal- 
 ism meant to the vassal. 
 
 Democracy has cast off the shadows of class rule, 
 but has retained the substance. It is as though the 
 government should confiscate such counterfeit coin 
 as fell into its hands, but should solemnly place the 
 hall-mark of its approval on the dies from which it is 
 coined. We have not changed the economic founda- 
 tions of life, however much we have altered the po- 
 litical forms. 
 
 Were it not for the veneration for the past and the 
 respect which property enjoys, we should see that the 
 private ownership of the land and indirect taxation 
 have ever been the agencies of oppression. It is 
 through these means that peoples have ever been 
 kept in subjection. But we refuse to question the 
 things that are. In religion, in law, in politics, prog- 
 ress has to make its way against the generations 
 which are long since dead. 
 
108 PRIVILEGE AND DEMOCRACY 
 
 This veneration for the past is always strongest 
 where the property rights of the ruling class are 
 involved. Macaulay has somewhere said that if 
 it were to the interest of an ascendant class to 
 deny the law of gravitation, there would arise an 
 organized resistance to its acceptance. It would 
 be challenged as impious, as contrary to the law 
 of God. It would be treated as at variance with 
 the laws of nature. Those who defended it would 
 be shunned. All preference would be closed against 
 them. They would suffer as did Galileo and Bruno 
 for daring to defend the theory of the revolution of 
 the earth in the face of the opposition of the holy 
 Church. 
 
 We fancy we are free from this reverential at- 
 titude in America. Yet America is ruled by the 
 political ideas of our grandfathers. The temple of 
 Delphi was scarcely more sacred to the ancient 
 Greeks than the Federal Constitution is to us. Criti- 
 cism is almost sacrilege. Yet a recent examination 
 of the circumstances surrounding its adoption shows 
 that the Federal Constitution was not intended to be 
 a democratic instrument.' It was not designed that 
 the people should rule. The reactionary spirits 
 who had taken small part in the Revolution ob- 
 tained control of the Constitutional Convention, and 
 impressed their will upon that body. And as later 
 interpreted by the courts the Constitution has be- 
 
 • The Spirit of American Government, J. A. Smith, p. 27. 
 
THE TYRANNY OF THE DEAD 109 
 
 come even more reactionary than its language im- 
 ports or its makers designed. 
 
 It was this veneration for propertied wrong that 
 continued negro slavery far into the nineteenth cen- 
 tury. It was only yesterday that slavery could not 
 be discussed with safety. Even in the Northern 
 states belief in its abolition involved personal vio- 
 lence. In some sections of the country the protec- 
 tive tariff enjoys something of the same sanctity. 
 It may not be discussed in the university, certainly 
 not in the pulpit. The franchise corporations of 
 our cities environ themselves with the same power- 
 ful influences, which close the press, the clubs, the 
 legal professions, and every avenue of preferment to 
 those who dare to question the most arrogant de- 
 mands of their owners. That which was true of 
 slavery, of piracy, and of the gentlemanly pursuit of 
 highway robbery in the generations which are gone, 
 is true of many of the most accepted institutions of 
 to-day. 
 
 The lineage of rent is far less honorable than is that 
 of chattel slavery, for slavery has had the approval 
 of almost every nation and of every religion. But 
 the private ownership of the land and the collection 
 of rent for its use is of comparatively recent origin. 
 And, as we have seen, it arose under such conditions 
 as give it a questionable claim upon posterity. 
 
 It is true the tenant of to-day does no labor in the 
 fields of his overlord; he is free from physical insult 
 
110 PRIVILEGE AND DEMOCRACY 
 
 and molestation; his lands may not be shot over 
 nor his crops destroyed; he need not grind his grain 
 at the mill of the lord, nor do menial services in his 
 household; he is not subject to personal services at 
 every turn, as he was in France prior to the Revolu- 
 tion. All these burdens of a personal sort have been 
 swept away. The methods of payment have been 
 changed, but the servitude remains as it was in the 
 days of the Normans or of the Plantagenets. Rent 
 has taken the place of the spear or the arrow; it has 
 taken the place of personal and military services. 
 The origin of rent is perfectly definite and clear. And 
 to-day, as during the Middle Ages, it is paid by those 
 who labor to those who do not. It is paid by all those 
 who do not participate in the ownership of the land. 
 We shudder at the inhumanity of the French 
 nobles, who muzzled their serfs in order that they 
 might not eat of the corn which they ground at the 
 mill. We protest against the cruelty of the absentee 
 landlords, who dissipated in idle luxury the exhaust- 
 ing rack-rents wrung from their starving Irish ten- 
 ants. We sympathize with the peasantry of Russia, 
 and aid by contributions and monster mass-meetings 
 their revolt against the oppression of the aristocracy. 
 Yet the suffering, the hunger, and the oppression 
 which seems so terrible at a distance is not very dis- 
 similar from that which is to be found in America 
 to-day. There is famine in New York and in 
 Chicago, in the mining regions and the mill dis- 
 
THE TYRANNY OF THE DEAD 111 
 
 tricts of America, just as there is famine in Russia, 
 in Poland, and in Ireland. And the cause is the same 
 in each country. There was food enough in Ireland 
 during the famine. Millions of produce were 
 shipped out of the country to pay rent when the 
 peasantry were dying of hunger by the tens of 
 thousands. There was wealth in abundance for the 
 landlords at a time when there was not even a po- 
 tato diet for those who produced whatever wealth 
 the country contained. And the infant mortality, 
 which carries away the children of the tenements like 
 a plague, is famine — famine in the midst of plenty, 
 just as it was in Ireland, just as it is in Russia and 
 India to-day. For the steamship and the telegraph 
 have made all the world a counter. There can be 
 no famine among a people who have the means with 
 which to purchase food. And it was not the failure 
 of food, it was the burden of rent which produced the 
 Irish famine of sixty years ago, just as it is the bur- 
 den of rent which sends 60,000 famished children 
 to school in the metropolis of America every day. 
 
 Were it not that our eyes are blinded by this prop- 
 erty sense, we should see that the right of the slum 
 owner to his rent had its origin in the days when men 
 were serfs; when society was ruled by force, and 
 legislation had its origin in craft and fraud. 
 
 The feudal state still persists in its essential quali- 
 ties. For the worker in New York still labors two 
 days out of every seven for his overlord in order 
 
112 PRIVILEGE AND DEMOCRACY 
 
 that he may be permitted to labor five days for him- 
 self. The corvee is still exacted as ruthlessly as it 
 was in the eighteenth century. The worker still 
 labors one day more out of every seven in order to 
 support the nation; not only to pay his own taxes, 
 imposts, and octroi on his food, but to pay those of 
 his overlord as well, who escapes their payment just 
 as did the grand seigneur in France. 
 
 Measured by its size the tribute of to-day is vastly 
 heavier than it was in the days of the ancient regime. 
 It is figured in millions instead of in thousands. It is 
 still paid by the vassal to the lord. It still supports 
 an idle aristocracy in the capitals of the world, just 
 as it did the French nobles at Versailles. The rent- 
 rolls of New York run into the hundreds of millions 
 each year. They are paid for the use of the earth, 
 just as they were two or ten centuries ago. And 
 they are collected with far more precision and with 
 much less hazard than at any time in the history 
 of mankind. 
 
CHAPTER X 
 THE SERVITUDE OF TO-MORROW 
 
 We have seen how the private ownership of the 
 land was evolved from the common ownership of 
 the land through the control of the governments of 
 Europe by the feudal aristocracy; how tenancy is 
 but the cash equivalent of the earlier relationship of 
 lord and vassal, of master and serf, a relationship 
 which historians assume was destroyed in the sev- 
 enteenth and eighteenth centuries. We have further 
 seen how competitive rents have been substituted 
 for the customary services of an earlier age, by means 
 of which those who use the land are subject to an 
 increasing tribute for the privilege of living upon 
 the earth. 
 
 Private land ownership is now complete. This is 
 true of practically all the world. Those who come 
 after us must come as trespassers. They must pay 
 a competitive price for the right to live. Future 
 generations will be born into servitude. Permission 
 to work must now be had of another, a permission 
 which can only be secured on the payment of a 
 price, and a price determined by the competition 
 of another for the same opportunity. It is competi- 
 tion that fixes rent, and it is the power of the owner to 
 
 113 
 
114 PRIVILEGE AND DEMOCRACY 
 
 exact such tribute as he wills that distinguishes the 
 servitude of to-day from that of the feudal regime. 
 
 We can now forecast the struggle which the future 
 holds in store for America. The supply of land is 
 fixed and constant. It is the same to-day as it was 
 four centuries ago when Columbus first set foot upon 
 the continent. No ingenuity of man can add a 
 square foot to the earth's surface. Better means of 
 transit, greater ease of communication, the reclama- 
 tion of the desert places of the West, all these have 
 increased the area available for cultivation. But 
 the amount of land remains as it was when the last 
 discoverer opened up the last continent to human 
 habitation. 
 
 The uncertain element in the equation is the de- 
 mand. This is indicated by the census returns. 
 The decennial enumeration of peoples will deter- 
 mine the fierceness of the struggle for existence and 
 the price which must be paid for the use of the earth. 
 The birth rate is the barometer by which the returns 
 of the landlord may be measured. 
 
 We need not go beyond the Civil War to see the 
 rapidity of the growth of population. From 1860 to 
 1870, during one-half of which time the nation was 
 convulsed with civil war and maintained more than 
 a million men under arms, the population increased 
 from 31,443,321 to 38,558,371, or 22.6 per cent. 
 During the following decade, a decade which was 
 coincident with the expansion of the West and the 
 
THE SERVITUDE OF TO-MORROW 115 
 
 projection of the Pacific Railway systems, 11,597,412 
 people were added to the population, or an increase of 
 30.1 per cent. By 1890 the population had mounted 
 up to 62,622,250, or an increase of 24.9 per cent.; 
 while, by the close of the century, 75,994,575 claimed 
 allegiance to the United States, or an increase of 
 20.7 per cent. In forty years' time the population 
 had increased over 141 per cent. If the population 
 increases as rapidly during the present decade as it 
 did during the last, America will contain 92,024,430 
 people in 1910. At the same rate of growth another 
 19,417,154 will be added by 1920. Continuing this 
 increase, the population of America will amount to 
 134,955,658 souls in 1930 ; to 163,430,301 in 1940, 
 and to 197,914,094 in 1950, or two and a half times 
 the present population. By the middle of the cen- 
 tury, at the present rate of growth, nearly 200,000,- 
 000 people will be struggling for the right to live in 
 America. But even then people will be living at a 
 density of but 67 per square mile, which is far 
 from crowded in comparison with other countries 
 or the Eastern states of America. For to-day the 
 population of Massachusetts is 348 per mile; of 
 Pennsylvania, 140 per mile; of Ohio, 102 per mile; 
 and of Wisconsin, 38 per mile. The population of the 
 German Empire is 280 per mile; of France, 188 per 
 mile; and of little Holland, 425 per mile. 
 
 With every babe that is born the value of the land 
 is increased, as is the tribute which its owners com- 
 
116 PRIVILEGE AND DEMOCRACY 
 
 mand for its use. The ignorant immigrant, landing 
 at Castle Garden, possessed of nothing save the cloth- 
 ing suspended across his shoulders, increases per- 
 ceptibly the value of the soil, upon which the laws of 
 nature decree that he must either labor or starve. 
 The million refugees who annually crowd to America, 
 driven unwillingly from their native land, add to the 
 value of the land at least half a billion dollars a year.* 
 Its value responds to their coming. There are so 
 many more hands to labor, so many more mouths to 
 be fed, so many more human beings to struggle for 
 an opportunity to live upon the land of promise 
 which another has enclosed. And the 80,000,000 
 already here are made the poorer by their coming. 
 The burden of rent of all the people is increased in 
 consequence.^ 
 
 Herein is the crux of the social puzzle. Herein 
 is the explanation of increasing poverty in the midst 
 
 ' " It has been calculated that by the mere fact of his arrival each 
 emigrant increased by about $400 the value of the territory of the 
 United States. " — Charles Gide, Political Ecor\omy, p. 458. This is 
 an understatement. It is nearer $1,000. 
 
 ' For the five years running from 1900 to 1905, the aggregate in- 
 crease in the value of all classes of farms was $6,131,000,000. The 
 cause of this increase in land values is indicated in the Bulletin 
 United States Department of Agriculture, No. 44, which says: 
 "While the public land suitable for farming has been reaching ex- 
 haustion, the flow of immigration from foreign countries has been 
 continuing in its direction, and where no farming land could be ob- 
 tained from nation, state, or railroad the influx of agricultural 
 people was halted in regions where farms had been established in 
 more recent years, and the consequent pressure of new demand upon 
 a fixed area increased the value per acre during the five years often 
 as much as fifty to a hundred per cent. " 
 
THE SERVITUDE OF TO-MORROW H7 
 
 of increasing wealth; of misery, destitution, and 
 suffering on the one hand, and unimaginable luxury 
 and waste on the other. In this struggle for the use 
 of the land and the speculative values to which it 
 gives rise, is the solution of the paroxysms of indus- 
 try which periodically afflict the commercial world. 
 It is this, too, that explains the vacant fields and 
 idle workshops, while millions of men are seeking 
 employment. 
 
 It makes no difference whether the land is owned 
 by a handful of ducal proprietors or by a million 
 petty landlords, whether by English syndicates or 
 by the well-to-do farmer of the neighboring county 
 seat. So far as those who hereafter come into the 
 world are concerned, the result is the same. For rent 
 is fixed by the law of demand and supply; supply 
 ever constant, demand increasing year by year. 
 
 This law of demand and supply, by which the 
 dealings of the business world are conducted; this 
 law which operates so beneficently in most instances, 
 determining with the precision of a natural law the 
 basis on which the products of labor will exchange, 
 the amount of food and clothing which will be pro- 
 duced each year, as well as the output of ten thou- 
 sand factories, mines, and workshops located in the 
 most distant portions of the earth; this law, which 
 adjusts production and exchange with a precision 
 almost comparable to that which determines the 
 amount of rain which shall fall upon the surface of the 
 
118 PRIVILEGE AND DEMOCRACY 
 
 earth, is a very cruel thing when appUed to the first 
 necessity of life which the laws of nature decree must 
 be used by man if he would live, but which the laws 
 of man permit to be owned by the generation which 
 first appropriates it. 
 
 Under natural conditions this growth in popula- 
 tion should increase the well-being of all the people 
 rather than the well-being of the few. For just as 
 the fisherman increases his catch by a division of 
 labor, which frees him from the necessity of making 
 his net or of preparing his meals; just as the hunter 
 is able to capture more game when relieved of the 
 necessity of making his weapons, so the productive 
 power of society has been increased by the division 
 of labor and the specialization of the workers which 
 has been going on from the beginning of time. The 
 watch we are now able to buy for a dollar once in- 
 volved weeks of labor. A single workman is now so 
 skilled in the handling of looms that he produces 
 three hundred times as much as was possible a 
 century ago. The cotton-spinner produces as much 
 as did three hundred and twenty men in 1769. One 
 operator in a cotton factory supplies the wants of 
 two hundred and fifty men; in a woollen factory, of 
 three hundred men, and in a shoe factory, of one 
 thousand men. A single man produces more iron, 
 steel, or copper than did a hundred a generation 
 ago; he produces more than did a thousand in the 
 seventeenth century. 
 
THE SERVITUDE OF TO-MORROW 119 
 
 This is true in almost every line of industry. 
 This increase in the productive power of society 
 should have long since banished poverty. For 
 along with every pair of hands seeking work there 
 are bodies to be clothed and stomachs to be fed. 
 Increasing population does not mean increasing pro- 
 duction only; it means increasing consumption as 
 well. And the wants of man know no limit. There 
 can be no such thing as overproduction. Even 
 were every human being comfortably housed, ade- 
 quately fed and clothed, even were all of the needs 
 with which we are familiar amply provided for, there 
 would arise a multitude of wants which would employ 
 ten times our present population. Yet instead of 
 improving the well-being of society, this increase in 
 population, increasing as it does the value of the 
 land and the rent which must be paid for its use, , 
 makes of necessity for poverty. It fills the tene- 1 
 ments with sweat-shop workers, and the mines with 
 child laborers. Some obstacle intervenes to prevent 
 the operation of the natural laws of production and 
 distribution; some influence diverts the gains of 
 civilization from those whose labor produces them. 
 This influence is the private ownership of the land 
 which withholds the storehouse of nature from use, 
 and appropriates through rent every increase in the 
 productive power of society. 
 
 From now on this tribute to those who own the 
 land must, of necessity, increase. With every babe 
 
120 PRIVILEGE AND DEMOCRACY 
 
 that is born and with every immigrant that comes 
 to our shores the struggle for a place to live and to 
 labor will be reflected in the value of the land. This 
 will increase the charge which may be exacted for its 
 use. This is the inevitable result of the law of de- 
 mand and supply when applied to the land, for rent 
 is established by the same law that fixes the ex- 
 change price of a loaf of bread or a pair of shoes. In 
 time rent will appropriate all that the worker can 
 produce save the margin of subsistence, below 
 which he cannot permanently go. Even this will 
 not be secure, for men will offer more for the land 
 than they can produce upon it in the hope of ward- 
 ing off starvation. 
 
 This tendency is already manifest. It is this that 
 explains the spirit of unrest that is expressing itself 
 all over the country. John Stuart Mill has de- 
 scribed the result of increasing population in the 
 case of Ireland. He had in mind the agricultural 
 workers. But the result is the same in any country 
 and under any conditions of industry. "The prod- 
 uce of the cottier (competitive) system," he says, 
 "being divided into two portions, rent and the re- 
 muneration of the laborer, the one is evidently de- 
 termined by the other. The laborer has what the 
 landlord does not take; the condition of the laborer 
 depends upon the amount of rent. But rent being 
 regulated by competition depends upon the relation 
 between the demand for land and the supply of it. 
 
THE SERVITUDE OF TO-MORROW 121 
 
 The demand for land depends upon the number of 
 competitors, and the competitors are the whole rural 
 population. The effect, therefore, of this tenure is 
 to bring the principle of population to act directly 
 on the land, and not, as in England, on capital. 
 Rent, in this state of things, depends on the propor- 
 tion between population and land. As the land is a 
 fixed quantity, while population has an unlimited 
 power of increase; unless something checks that in- 
 crease, the competition for land soon forces up rent 
 to the highest point consistent with keeping the 
 population alive. " * 
 
 This, then, is the servitude of to-morrow. It is 
 not new to the world. But it is only since the 
 seventeenth century that the law has endowed one 
 man with legal means to take from another all that 
 he could get. 
 
 The extent to which the growth of population, 
 the improvements in the arts and sciences, the in- 
 crease in the productive power of society, have ex- 
 pressed themselves in the value of the land, and the 
 amount which has been added to the wealth of the 
 few by the exertions of the many, will be considered 
 in the next chapter. 
 
 ' Principles of Political Economy, chap. 9. 
 
CHAPTER XI 
 THE UNEARNED INCREMENT 
 
 We have witnessed the changes which have taken 
 place in the economic foundations of democracy 
 during the past few years; we have seen how ten- 
 ancy has followed close upon the heels of three cen- 
 turies of freedom through the prodigal waste of our 
 land and resources; we have projected our imagina- 
 tion into the future when the population will have 
 doubled, and the struggle for existence will have in- 
 creased in intensity through the demand for the land, 
 which must ever remain limited in amount. We 
 have seen, too, how the growth of population creates 
 a social value which is not retained by the commu- 
 nity, but is appropriated by those who own the land. 
 
 Such is the process by which organized society im- 
 poverishes itself; such is the process by which it has 
 always done so. Such, too, are the means by which 
 the servitude of the Middle Ages is continued down to 
 the present day, for we are the lineal heirs of serfdom, 
 just as the Church and the jurisprudence of to-day are 
 the heirs of many of the abuses of the Middle Ages. 
 
 But the growth of population is not the only 
 agency which adds to the wealth of those who own 
 the soil. All other activities contribute to it. Good 
 
 122 
 
THE UNEARNED INCREMENT 123 
 
 government reflects its goodness in the value of the 
 land. It increases its security as well as its at- 
 tractiveness for homes and business. The opening 
 up of streets and sewers, the dedication of parks and 
 open spaces, all these contribute to the enrichment 
 of those who toil not nor spin. Even the education 
 of kindergarten, school, and university, the building 
 of cathedrals and public structures, the increase in 
 health and security, all these are reflected back into 
 the value of the land, and must be paid for by those 
 who make use of it. 
 
 The progress of science and invention, the design- 
 ing of new machines for increasing the wealth of 
 mankind, all these, as well as every advance in civ- 
 ilization are passed on to the pockets of the landlord. 
 And this increased wealth which society contributes 
 to his purse is as unearned by him who appropriates 
 it as was the manna which descended from heaven 
 to the Hebrew people. It enriches the most barren 
 of building sites as does the dew upon the grass, or 
 the ray of the rising sun to which all nature responds. 
 The invention of the Bessemer process, the cheapen- 
 ing of the means of transportation, the erection of 
 mammoth iron steamships, the expenditures of mill- 
 ions of dollars by the Federal Government upon the 
 inland waterways of America, have not cheapened the 
 cost of iron and steel to the consumer. They have 
 but added tens of millions of value to the iron and 
 the coal mines, the railways and the harbors owned 
 
124 PRIVILEGE AND DEMOCRACY 
 
 by those who sit idly upon the resources of the earth 
 which they have been permitted to monopoHze. 
 Every improvement in the railways, every new de- 
 vice for doing the work of human hands, has added 
 to the capital value of the land and the mineral re- 
 sources of the country. The application of elec- 
 tricity to transit upon our streets has not solved the 
 housing problem. It cheapened the cost of produc- 
 tion to the owners of the franchises. It increased the 
 value of city and suburban land. But any reduc- 
 tion in the charges for transit and electricity, for gas 
 and for water is ultimately absorbed by the owners 
 of the land, who thwart every effort for the relief of 
 housing conditions by the speculative withholding 
 of building sites. Even the increased efficiency of 
 labor is not appropriated by capital. The capital- 
 ist is but the intermediary through whose hands the 
 increasing productivity of society flows. For he, 
 too, like the wage-earner and the tenant farmer, is 
 subject to the tribute which the private ownership 
 of the land involves. 
 
 We can see this unearned increment which society 
 creates most readily in the great cities. And we can 
 visualize it in the fortunes of some old family. The 
 estate of the Astors in the city of New York is a 
 striking example. In less than fifty years' time the 
 crowding of 5,000,000 people around Manhattan 
 Island has given a value to the Astor estate of 
 $450,000,000. Scarce a century ago the ancestor 
 
THE UNEARNED INCREMENT 125 
 
 of the present family invested a few thousand dol- 
 lars in farming lands lying about the outskirts 
 of what was then a mere village. Much of the 
 property so acquired was barren rock. And so it 
 has remained to this day. In itself it has little more 
 value than the rolling prairies in Nebraska. Since 
 that time the hand of man has added little to its 
 fertility. No modern alchemy has changed its char- 
 acter. The land is much as it was when the glaciers 
 of a distant age laid it bare to the elements. But the 
 growth of a great nation, the development of trade 
 and commerce, the revolutions which have taken 
 place in industry, have fertilized this granite outcrop 
 until it produces golden eagles from every rod of its 
 surface. Society has done what the Astor family 
 could not have done, even with the lamp of Aladdin. 
 And society has done everything that has been done 
 to make the land valuable. When Jacob Astor died 
 in 1848, the value of his holdings had increased until 
 they were worth $20,000,000. A quarter of a cen- 
 tury later the estate had grown in value to $100,- 
 000,000. By 1890 it was estimated to be worth 
 $250,000,000. Seventeen years have since elapsed, 
 and in that time the struggle of mankind for a 
 footing on this most densely peopled spot in the 
 western world has given a value of $450,000,000 to 
 the Astor estate.* "In fifteen or twenty years, at 
 
 ' "The Astor Fortune, " by B. L. Hendriek, McClure's Magazine, 
 1905. 
 
126 PRIVILEGE AND DEMOCRACY 
 
 the present rate of progress, it (the Astor estate) will 
 have reached the billion mark, and then it will go on 
 even faster, till the ordinary mind is appalled at the 
 portentous figures. ... If the same rate be main- 
 tained for another century, the Astor fortune will 
 attain the unimaginable total of $80,000,000,000." ' 
 The insignificant investment of a century ago has 
 multiplied many thousand times. And by means of 
 short leases, revalued from time to time, the values 
 which society created have all been retained by the 
 estate. Public improvements, the opening up of 
 streets, the laying out of parks and boulevards, the 
 development of transportation, the increase in secur- 
 ity and attractiveness, all of the expenditures of the 
 metropolis, have passed into the value of the land. 
 The recently opened Subway, which was paid for from 
 out the city's credit, is said to have added an amount 
 equal to its cost to the value of the Astor holdings.'' 
 
 'The Astor estate is but one of many in the metropolis. The 
 value of the land underlying the city staggers the imagination. 
 A short time ago the small corner lot at No. 1 Wall Street was sold 
 for $700,000. It contains about 1,170 square feet. Its purchase 
 price was about S4.00 per square inch. In 1902 the building site at 
 the comer of Fifth Avenue and 28th Street was sold for $400,000. 
 Within twelve months it was resold for $550,000. To-day its value 
 is not far from $1,000,000. But a few years ago the land upon 
 which the Times building is erected, at the comer of Broadway and 
 42d Street, was in the market for $500,000. It recently sold for 
 nearly three times this figure. Cases of this sort can be multiplied 
 indefinitely, from the Battery to the Bronx. 
 
 2 See report of New York City Club entitled "Building of Rapid 
 Transit Lines in New York City by Assessment upon Property Ben- 
 efited, " which showed that the value added to adjacent land by the 
 building of the Subway would have paid its cost several times over. 
 
THE UNEARNED INCREMENT 127 
 
 The whole of Manhattan Island was first sold to 
 the Dutch by the Indians for $28.00. In 1904 the 
 land values of Greater New York were appraised 
 for taxation at $3,057,161,290. By 1906 the land 
 had increased in value to $3,391,711,526. In two 
 years' time $334,550,236 had been added to the 
 fortunes of those already enriched through the city's 
 growth. They had done nothing to create this value. 
 They had given no labor, no thought to the develop- 
 ment of the city. Many of the owners lived in dis- 
 tant parts of the world. The growth continued just 
 the same. By 1907 the appraised value of the land 
 underlying the city had advanced to $3,557,591,504, 
 or an increase over the year before of $165,879,978. 
 In 1908 the valuation had still further increased to 
 $3,843,165,597, or an increase of $284,271,643.' 
 
 The human imagination cannot comprehend such 
 stupendous figures. The total area of the city is but 
 190,000 acres. The land is worth $213,400 per acre. 
 One acre of the metropolis would buy an average 
 farm of 5,000 acres in extent. The land values of 
 Greater New York exceed the total value of all the 
 buildings and improvements in the city, on which 
 generations of labor have been expended, by over 
 $700,000,000. 
 
 In 1900 the value of all of the farm property 
 in the nine states of New York, New Jersey, Penn- 
 
 1 Taken from Annual Reports of Commissioners of Taxes and 
 Assessments of New York for these years. 
 
128 PRIVILEGE AND DEMOCRACY 
 
 sylvania, Massachusetts, Connecticut, Maine, New 
 Hampshire, Vermont, and Rhode Island was but 
 $2,950,532,628, or $607,058,876 less than the value 
 of the naked land in New York City in 1907. This 
 value exceeded by nearly $1,000,000,000 all of the 
 capital in the United States invested in machinery, 
 tools, and implements in 1900. It was almost equal 
 to the value of all the farm buildings in the United 
 States. 
 
 This narrow point of land which forms the gate- 
 way of the nation, and which can scarcely be dis- 
 cerned upon the map, exceeds in value the census 
 appraisal of all of the farming land with the improve- 
 ments thereon lying to the east of the Alleghany 
 Mountains. It is equal to one-sixth of the total 
 value of the 841,201,346 acres of improved land in 
 the United States. Into these farms have gone three 
 centuries of struggle. They represent the sacrifices 
 of the pioneer, of the log cabin, and the prairie 
 schooner, the drought and the scourge of the West- 
 ern prairie. In this making of a nation are all the 
 sacrifices and the isolations, the struggles and the dis- 
 appointments, the lack of opportunities for educa- 
 tion, and the unceasing toil of those who have con- 
 verted the plains of America into fields of golden corn 
 and grain. Yet a few thousand landlords, who have 
 possessed themselves of a spot of land but little 
 larger than a Western township, have come into pos- 
 session of wealth half as valuable as all the farm 
 
THE UNEARNED INCREMENT 129 
 
 products produced in a single year in the United 
 
 States. 
 
 No thrift of the owners created this value; but 
 the coming of population, the development of com- 
 merce and industry, the perfection of the arts and 
 sciences, all these agencies have brought into exist- 
 ence unearned incomes more princely than that 
 which enabled Crassus to unite with Csesar and Pom- 
 pey in the control of the Roman republic* 
 
 All other wealth save the land has an exchange 
 value, measured by its labor cost. Under free com- 
 petition, this is as true of a locomotive or of a monster 
 steamship as it is of a pair of shoes or a sack of flour. 
 It is the amount of labor which enters into each that 
 determines the price at which it exchanges. But 
 no such rule fixes the annual value of the land. 
 Rent is not the equation of labor for labor; it is the 
 resultant of a certain number of human beings seek- 
 ing a chance to live. And the rent that is paid is the 
 price exacted by those who own from those whose very 
 labor has given the land whatever value it enjoys. 
 Society is really taxed because of its own enterprise. 
 
 ■New York is not exceptional in this regard. In 1902 the land 
 and the franchises of the city of Boston were appraised at $879,259,- 
 355 or $1,100 per capita. In 1906 they had increased to $1,047,- 
 499,500. In city after city where assessments assume to represent 
 the real selling value of property, the value of the land alone amounts 
 to nearly $1,000 per head of the population. The land value or 
 social value of America in city and country, from the data available, 
 would seem to amount to from $750 to $1,000 per capita for every 
 man, woman, and child in the country. 
 
130 PRIVILEGE AND DEMOCRACY 
 
 In reality land values are not wealth at all. They 
 are a power to tax, a power to levy tribute upon 
 the wealth which others produce. Land values are 
 merely a toll, and rent is in the nature of an annual 
 license for the privilege of living, which the laws of 
 the land permit one class to collect from those who 
 labor upon the earth. 
 
 Here, too, is a kind of wealth whose value increases 
 automatically. It is a form of monopoly more per- 
 fect than any oil-, beef, or sugar trust. It requires no 
 syndicate, no understanding, no gentlemen's agree- 
 ment to determine what the traffic will bear; no 
 pooling of interests or division of territory is neces- 
 sary for the fixing of tariffs. The tribute which the 
 landowners collect is determined with mathematical 
 precision. It is fixed by the simple law of demand 
 and supply, and the letter of the bond is collected as 
 ruthlessly as the rack-rents of Ireland.' 
 
 The Census Department has recognized the phe- 
 nomenal increase in land values which is every- 
 where taking place. From 1900 to 1904 something 
 
 > We can see the growth in population and the industry of a people 
 expressing itself in the value of the land in the newer states of the 
 West. Within the past few years, the territory of Oklahoma has 
 been opened up to settlement. Here is one of the most fertile regions 
 of the world. In the early nineties land was selling at from $2.00 
 to $5.00 an acre. To-day it is changing hands at from $10.00 to 
 $30.00 an acre. In 1900 the assessed value of the farming land was 
 $9,875,638. To-day it is assessed at $35,472,012. (Report of the 
 Governor of Oklahoma to the Secretary of the Interior, 1906.) It 
 is probably worth ten times that figure. 
 
THE UNEARNED INCREMENT 131 
 
 less than one-half of the acre property in the United 
 States increased in value over $1,500,000,000. The 
 growth in the value of all agricultural land was, 
 therefore, something over $3,000,000,000. During 
 the same period, land and improvement values in 
 city as well as country increased over $9,000,000,000, 
 which means that the land values of the nation shot 
 up at least $4,500,000,000 in four years' time.* 
 
 This is a very conservative estimate. The De- 
 partment of Agriculture states that the aggregate 
 increase in the value of all classes of farms during 
 the five years running from 1901 to 1905 was 
 $6,131,000,000.' 
 
 We see the same social values, the same com- 
 mon treasure, in the value of the mineral resources 
 of America. It is apparent in the coal, the iron, 
 and the copper fields. Twenty years ago the 
 barren lands of northern Minnesota, Wisconsin, and 
 Michigan, upon which the Mesabi, Vermillion, Gego- 
 bic, and Menominee iron ranges were discovered, were 
 practically valueless. But the demand for iron and 
 steel, the improvement in machines and transpor- 
 tation, a thousand inventions increasing their use, 
 has enabled the United States Steel Corporation to 
 place a value of $700,000,000 upon its ore fields alone. 
 The president of the company testified that even this 
 value was inadequate. He stated before the In- 
 
 ' Census Reports, "Wealth, Debt, and Taxation," pp. 20 and 26. 
 ''Bulletin No. 44, "Local Conditions Affecting Farm Values." 
 
132 PRIVILEGE AND DEMOCRACY 
 
 dustrial Commission that the ore holdings were 
 worth from $1,000,000,000 to $2,000,000,000.' We 
 see the same unearned increment in the Calumet 
 and Hecla copper mine. Its stock was issued at 
 $12.00 a share. It is now selling for $650 a share, 
 and has sold as high as $1,000 a share. 
 
 Society has been busy by night as well as by day, 
 and a steady stream of wealth has been flowing into 
 the laps of those who happened to acquire these 
 marvellous deposits. The Calumet and Hecla is 
 but a bonanza mine among many such copper de- 
 posits which are to be found in Montana, Utah, 
 Arizona, and elsewhere, whose combined values are 
 not far from $500,000,000. Less than a century 
 ago the anthracite coal fields of western Pennsyl- 
 vania were opened up to use. For fifty years they 
 were regarded as of comparatively little value. But 
 through the consolidation of the railway systems 
 entering the territory and the complete monopoly 
 of the region, these resources and railways have been 
 capitalized at over a half billion dollars. 
 
 To these spectacular exhibits must be added the 
 bituminous coal fields which spread from the Alle- 
 ghanies to the Rockies, and underlie whole com- 
 monwealths with their rich deposits; as well as the 
 oil wells which are pouring forth wealth of fabulous 
 value. Hundreds of millions more should be added 
 for the silver, zinc, lead, and other minerals whose 
 
 ' Report of Industrial CommisBion, Vol. XIII, p. 472. 
 
THE UNEARNED INCREMENT 133 
 
 value is constantly increasing through the needs of 
 humanity. 
 
 But the land and mineral resources do not com- 
 plete this enumeration of the unearned increment. 
 The same process of social production and private 
 appropriation is apparent in the capitalization of 
 the railways. It may be seen in the swollen secu- 
 rities of the franchise corporations. Year by year 
 evidences of ownership are issued to keep pace with 
 the value which the growth of society pours into 
 the pockets of those who own them. No new wealth 
 is called into being in the process. The country is 
 no richer by reason of the increased securities which 
 are issued. In 1907 the railways of the country 
 were capitalized at $16,082,146,683. Ten years ear- 
 lier they were capitalized at but $10,635,008,074. 
 The difference is largely a site or land value just 
 like that which a corner lot enjoys. The increasing 
 value of the franchise corporations of our cities is of 
 the same character. It is a social product, due to 
 the favored sites which the public utility corpora- 
 tions occupy. The value of their securities reflects 
 the growth of population. The unearned incre- 
 ment of the franchise corporations of New York 
 City runs into the hundreds of millions of dollars.' 
 
 'Mr. John Moody, editor of Moody's Manual, says: " The pub- 
 lic utility corporations of New York City cost to construct less 
 than $200,000,000, and yet to-day they are capitalized for over 
 $1,000,000,000."— "The Evolution of the Trust," The Arena, May, 
 1907. 
 
134 PRIVILEGE AND DEMOCRACY 
 
 What is true of the city of New York is true of all 
 the cities of America. Franchises for street rail- 
 ways, for gas, water, electric-lighting, telephone, 
 and other corporations have been granted by cor- 
 rupt or ignorant councils, or bestowed upon favor- 
 ites by the legislatures of our states, much as the 
 English Stuarts gave away the property of the 
 nation to the worthless favorites of the king. Yet 
 the privileges bestowed in the olden days were of 
 insignificant value in comparison with the princely 
 gifts of our cities, many of them in perpetuity, and 
 all of them for long periods of time. In almost 
 every large city these grants exceed in value the 
 amount of the city debt. 
 
 Unfortunately there is no means of ascertaining 
 the amount of this social wealth, this land value 
 which, by every principle of justice, belongs to us all. 
 Yet it should be the first concern of the govern- 
 ment to ascertain its amount. For if it be the first 
 obligation of society to protect the property which 
 has been produced by the individual, it is surely 
 an obligation scarcely less sacred to ascertain and 
 make known the wealth which is the common 
 property of us all. 
 
 It is, however, possible to estimate this unearned 
 increment, which the laws of society permit to be 
 appropriated by those who own the land. In 1904 
 an investigation was made by the Census Bureau 
 of "Wealth, Debt, and Taxation" in the United 
 
THE UNEARNED INCREMENT 135 
 
 States. From this report it appears that the value 
 of the land with its improvements, as well as of the 
 railways and the franchise corporations, amounted 
 to $71,195,626,966.' Unfortunately no distinction 
 is made as to pure land values and improvement 
 values. But from other and independent investi- 
 gations, from the tax valuations of cities where 
 land and improvements are separately valued, it is 
 safe to say that the land values are fifty per cent, 
 of the total. On this basis the pure land values of 
 the country amount to not less than $35,000,000,- 
 000. They undoubtedly exceed this amount. Mr. 
 John Moody estimates them at $60,000,000,000.' 
 
 No other forms of wealth, save the land and the 
 privileges identified with land, respond in this way 
 to the growth of population. Society works for the 
 owner of the land and him alone. Every other 
 form of wealth is produced by individual labor. 
 Every other form of wealth depreciates and decays. 
 It has but a transitory existence. Much of it does 
 not survive the year which saw it produced. Such 
 wealth involves constant care and attention. But 
 each tick of the pendulum of time passes into the 
 purse of those who own the land the power to take 
 from those who toil an increasing portion of that 
 which their labor produces. 
 
 ^United States Census, "Wealth, Debt, and Taxation," p. 27. 
 ^"The Evolution of the Trust," The Arena, May, 1907. For a 
 fuller discussion of land values in America see Appendix No. 1. 
 
136 PRIVILEGE AND DEMOCRACY 
 
 Land values are not really wealth at all, although 
 the increase which has taken place in recent years 
 has been heralded as a sign of increasing prosperity. 
 And such it is to those who enjoy the increasing 
 rents which land values make possible. But wealth 
 is something which ministers to the comfort, hap- 
 piness, and well-being of humanity. Houses are 
 wealth; food, clothing, machinery, tools, and works 
 of art and refinement are wealth. All of the prod- 
 ucts which labor creates are wealth. But land 
 values are a tax on wealth. Rent is in the nat- 
 ure of a tax. It is far worse than a tax. So- 
 ciety receives some return from its taxes. It re- 
 ceives none whatever from the pajmaent of rent. 
 Rent is a tribute from labor to those who give no 
 service in return. 
 
 In his Essays in Political Economy, Frederic 
 Bastiat, the French economist, tells the story of 
 the gratification of the crowd which had collected 
 before a broken shop window. 
 
 "It will make more work for the glazier," said 
 one of the crowd. "It is a good thing for property 
 to be destroyed, otherwise no one would give us 
 employment. " 
 
 This is the result that was seen. The unseen 
 thing was that the shopkeeper would have to go 
 without a needed pair of shoes. He would have 
 to make some sacrifice in order to pay for the loss. 
 The making of the shoes would also have provided 
 
THE UNEARNED INCREMENT 137 
 
 work, but work which would have added to the 
 wealth of society. This is the result that was 
 unseen. 
 
 So it is with the growth of land values. Those 
 who measure the well-being of a nation through 
 the increase in the value of the land and the in- 
 flated capitalization of the mines, the railways, and 
 the franchise corporations, see in these vaulting 
 figures an increase in the wealth of the people. 
 But the effect that is not seen, like the cost of the 
 broken pane of glass to the shopkeeper, appears 
 in the increasing cost of living to those who bear' 
 the burdens which these increasing values involve. 
 Their standard of living is reduced. The demand 
 for the products of labor is diminished. The out- 
 put of the factory is curtailed. It is this increasing 
 rent charge which reduces the amount of wealth 
 which can be consumed. In time the industry of a 
 country will be greatly impaired through the ap- 
 propriation by rent of a great part of what the na- 
 tion produces. For the well-being of a nation, in 
 the last analysis, depends far less on the amount of 
 wealth that is produced than on the way it is dis- 
 tributed. 
 
CHAPTER XII 
 
 A FEUDAL SURVIVAL 
 
 The railway question is at bottom a land ques- 
 tion. The railway is a monopoly because of its 
 identity with the land. It is this that differen- 
 tiates the transportation industry from other busi- 
 ness. The right of way of a railway is a site of land 
 long drawn out. It is of much greater value than 
 that of adjacent farms because of this fact. The 
 particular site which it occupies cannot be du- 
 plicated. Terminals in the cities can only be ob- 
 tained at a prohibitive cost. In many instances 
 the only available routes through the mountains 
 are already occupied. No new corporation could 
 raise sufficient capital to force an entrance into 
 New York, Philadelphia, Chicago, or any of the 
 other large cities in the face of the opposition of the 
 existing lines. We have an example of this diffi- 
 culty in the entrance of the Gould lines into Pitts- 
 burg. The Vanderbilt system owns a narrow strip 
 of land along the Mohawk River, which is almost 
 the only available railway route in New York 
 state between the Hudson River and the West. 
 The same is true of the Pennsylvania and the Bal- 
 timore and Ohio systems further south. Compe- 
 
 138 
 
A FEUDAL SURVIVAL 139 
 
 tition is only possible by tunnelling through moun- 
 tain ranges and the appropriation of city lands of 
 fabulous value. 
 
 It is their identity with the land that makes the 
 highways of the nation natural monopolies. It is 
 this that explains the ease of their consolidation, 
 the watering of their securities, the constant growth 
 of earnings, and the difficulty, if not the impossi- 
 bility, of regulation by the nation or the states. 
 
 And the value which a railway enjoys is like that 
 of the land underlying a city. Its earnings increase 
 with the growth of population and of industry. 
 Locomotives, cars, and equipment can be repro- 
 duced indefinitely, just as can wagons, carriages, 
 or automobiles. In these things there can be no 
 permanent monopoly. But in any industry affixed 
 to the land, like a railway, a franchise corporation, 
 or a mine, monopoly is almost inevitable. For 
 continued competition is impossible. 
 
 We can see this identity of the railways with the 
 land in the growth in their securities. In 1906 
 the aggregate outstanding railway securities of the 
 country were $14,570,421,478, of which $7,766,- 
 661,385 was in the form of bonded indebtedness. 
 According to the United States Census valuation, 
 the total wealth of the country in 1904 was $107,- 
 104,000,000. The outstanding securities of the 
 railways amounted to 13.7 per cent, of the total. 
 The bonded indebtedness alone amounts to $36,213 
 
140 PRIVILEGE AND DEMOCRACY 
 
 per mile. This is more than the known average 
 cost of construction of many roads. In many in- 
 stances the bonds have been watered as well as 
 the stock. In 1898 the total railway capital was 
 but $10,818,554,031; in 1900 it had increased to 
 $11,491,034,960, in 1903 to $13,213,124,679, while 
 in 1906 it had risen to $14,570,421,478. 
 
 Capitalization fast outruns the growth in mileage. 
 During the year 1905, $600,000,000 of new securi- 
 ties were issued. The construction in that year 
 was but 4,000 miles. This is equivalent to $150,000 
 a mile, probably more than three times the actual 
 cost of the increased mileage. According to the 
 report of the Industrial Commission $457,000,000 
 of securities were issued in 1900, of which not more 
 than $120,000,000 could be assigned to new con- 
 struction. 
 
 Wherever population is densest there the capi- 
 talization is highest. The Erie Railway carries a 
 capitalization of $300,000 per mile. The Lake 
 Shore and Michigan Southern, a road of much su- 
 perior construction and equipment, is capitalized at 
 $100,000 per. mile. The total capitalization of the 
 Michigan Central Railroad amounts to $402,000 
 per mile. The average capitalization for the en- 
 tire country is $81,791 per mile. 
 
 The watered securities of the railways are so- 
 ciety's contributions to the owners. They repre- 
 sent no increase in the wealth of the nation, no 
 
A FEUDAL SURVIVAL 141 
 
 great intelligence or thrift on the part of the owners, 
 no addition to the comfort and convenience of the 
 people. Increased capitalization where no real in- 
 vestment is made means increased orders on the 
 labor and industry of the future. 
 
 It is possible to measure the exertions of society 
 on behalf of those who own the highways in the 
 growth of their earnings, as well as in their in- 
 creasing capitalization. In 1897 the gross earn- 
 ings of the railways amounted to $1,222,089,773. 
 Ten years later they had grown to $2,346,640,000. 
 During the same period net earnings increased 
 from $369,565,009 to $790,188,000, a gain of $420,- 
 622,991. During these years railway mileage in- 
 creased but 22.2 per cent., while the gross and net 
 earnings increased over 100 per cent, and the divi- 
 dends over 200 per cent. 
 
 In this, as in many other respects, the nineteenth 
 century has reproduced the institutions of earlier 
 ages. The private ownership of the railways is an 
 instance of political atavism. Along the banks of 
 the upper Rhine, perched upon some inaccessible 
 crag or point of land, may still be seen the majestic 
 ruins of castles fast passing to decay. They date 
 from a period when the only authority was force, 
 and the only government the will of the feudal 
 overlord. Throughout lower Germany from the 
 Netherlands to the Tyrol; in France, in Austria, 
 in Italy — ^in fact all over the face of Europe, these 
 
142 PRIVILEGE AND DEMOCRACY 
 
 monuments of an earlier society stand out grimly 
 from every point of vantage, suggestive of the reign 
 of force and lawlessness which was the only govern- 
 ment in continental Europe for a thousand years. 
 From these fastnesses the lords of the surrounding 
 territory levied tribute upon the caravans which 
 passed that way. They, too, did it as a matter 
 of right. Did they not own the highways? They 
 filled their castles with the tapestries and the luxu- 
 ries of the Orient. They took what they needed 
 of the industries of Italy and Germany; theirs were 
 the best of wines and the costliest of furnishings. 
 Without labor they maintained themselves and 
 their followers through the labor and industry of 
 others. This tribute was exacted no more arbi- 
 trarily than that of the railways of to-day. Then 
 as now this power was possible through the owner- 
 ship of the land, by means of which the highways 
 of the country were controlled. 
 
 The railways of to-day levy tribute upon all 
 trade. They collect a toll upon all industry. By 
 reason of the complexity of industrial relations, 
 the railways have become indispensable to our life. 
 They are the arteries of commerce. Were they 
 closed by some calamity of nature, the entire popu- 
 lation of our cities would be on the brink of starva- 
 tion in a few days' time. All industry would come 
 to a standstill. To this extent are we dependent 
 upon the will of the modern barons of privilege into 
 
A FEUDAL SURVIVAL 143 
 
 whose hands we have intrusted this most vital 
 function of our lives. Every article of consump- 
 tion is subject to this tribute; a tribute which is 
 fixed by the arbitrary will of a handful of men, 
 just as was the toll of the passing traveller of the 
 Middle Ages to the overlord of the territory through 
 which he passed. 
 
 The identity of the railway with the land not 
 only explains the increase in capitalization and the 
 growth in earnings, it also explains the ease of 
 their consolidation. The railways cannot be du- 
 plicated. The very nature of the railway business 
 makes it a monopoly; a monopoly which has rap- 
 idly concentrated into a very few hands.' 
 
 ' Senate Document No. 278, 60th Congress, 1st session, 1908, on 
 " Interstate Commerce Corporations Owning Capital Stock of Other 
 Transportation Companies, " shows the extent of this community of 
 control and interest between the railways of the country as well as 
 the extent to which this control is lodged in the banking and financial 
 interests. From this it appears that fifty-one persons constitute a 
 majority of the board of directors of the great railway systems of the 
 country, comprising 63.29 per cent, of miles operated, 64.7 per cent, 
 of the gross earnings, 71.69 per cent, of the ton mile of freight 
 carried, and 66.12 per cent, of the commercial value of operating 
 property. The report says: "The extent of the centralization of 
 control in railway administration is not fully disclosed by the in- 
 formation thus far presented. Community of interest and unity of 
 direction extend beyond the contractual or proprietary relations 
 which underlie the systems. This may be termed the control of 
 group interests. It has long been a matter of common knowledge 
 that in many cases a comparatively small number of men, acting 
 unitedly, may, through their ownerships or control of stocks in the 
 controlling corporations of two or more systems, unify the operations 
 of those systems in such a wise as to produce as harmonious opera- 
 tion as could be had if all the elements were aggregated into a single 
 
144 PRIVILEGE AND DEMOCRACY 
 
 There are six great groups* whose mileage and 
 capitaUzation includes practically all of the greater 
 transportation agencies of the country. And these 
 groups are interrelated by the closest of ties. They 
 are banded together by the closest of business, 
 personal, and financial interests.* 
 
 system. . . . When the same individuals constitute harmoniously 
 acting majorities of the boards of directors of two or more corpora- 
 tions, it seems proper to say that the control of the particular cor- 
 porations whose boards are thus constituted is actually unified. " — 
 P. 109. 
 
 It further appears from the same report that ninety-three persons, 
 acting together, would be able to control more than 75 per cent, of the 
 operated mileage of the country, more than 81 per cent, of the gross 
 earnings, more than 87 per cent, of the tonnage, and more than 82 
 per cent, of the commercial value of railway operating property. — ■ 
 P. 110. 
 
 As a matter of fact, if the individuals who nominally appear upon 
 the directorates of these railways were still further reduced to the 
 real owners, it would be found that six or eight financial interests, 
 the Rockefeller, Morgan, Vanderbilt, Harriman, Gould, Pennsylvania, 
 Kuhn-Loeb, Moore, and one or two other harmoniously acting finan- 
 cial groups, really controlled from 75 to 90 per cent, of the railway 
 systems of America. 
 
 • By 1903 the following community of interest had come to prevail: 
 Group Mileage Capitalization 
 
 Vanderbilt group 21,888 1,169,196,132 
 
 Morgan 47,206 2,265,116,350 
 
 Harriman, Kuhn-Loeb . . . 22,943 1,321,243,711 
 
 Pennsylvania 19,300 1,822,402,235 
 
 Gould, Rockefeller .... 28,157 1,368,877,540 
 
 Moore 25,092 1,070,250,939 
 
 164,586 9,017,086,407 
 
 See Moody's Truth About the Trusts, p. 439. 
 
 ""The financiers who are at the head of an entirely administered 
 railroad trust are J. Pierpont Morgan, John D. and William Rocke- 
 feller, W. K. and W. P. Vanderbilt, George J. Gould, A. J. Cassatt, 
 James J. Hill, Edward Hawley, H. H. Rogers, August Belmont, 
 Thomas F. Ryan, W. H. and J. H. Moore. . . . The superior domi- 
 
A FEUDAL SURVIVAL 145 
 
 This narrowing of control will undoubtedly con- 
 tinue. Competition is already at an end. In the 
 hands of a syndicate of stock speculators the life 
 and industry of 80,000,000 people rests. Through 
 discrimination and rebates they have crushed 
 out competition in the oil business; they have 
 concentrated the ownership of the anthracite and 
 bituminous coal in their own hands; they have 
 aided in the monopolization of the iron and the 
 steel, the sugar and the tobacco monopolies. The 
 meat-packing monopoly has been fostered by car 
 and freight-rate favors until it is invulnerable. 
 Almost every one of the universal necessities of 
 life has been monopolized by this process, or its 
 cost increased to the consumer. For the power 
 to fix railway rates is the power to destroy. It 
 is, in all respects, a power to arbitrarily tax. The 
 standard of living of the consumer, the farmer, 
 and the mechanic lie under this control. The 
 prices of wheat and of corn, of beef and of other 
 foodstuffs are now determined in the markets of 
 the world. That which the farmer receives is fixed 
 in Liverpool. The returns of his efforts are de- 
 termined by none of the elements which control 
 the returns of the manufacturer, the retail dealer, 
 or the professional man. They are fixed by the 
 
 nating influence of Mr. Rockefeller and Mr. Morgan is felt in greater 
 or less degree in all of the groups." — Moody's Truth About the 
 Trusts, p. 442. 
 
146 PRIVILEGE AND DEMOCRACY 
 
 competition of Russia and Argentina. And the 
 railways determine what portion of the world-made 
 price the farmer shall receive. It frequently costs 
 as much to place his wheat and corn at the seaport 
 as he receives for it. The charges of the railways, 
 like the rent of the landlord in Ireland, is fixed by 
 what the railway managers think the farmer will 
 bear. Such a power has no parallel in the history 
 of mankind. 
 
 The railway problem is far more serious than the 
 evils which have been thus far attacked. Legis- 
 lation has been directed against discriminations 
 and rebates. But a more serious evil remains, an 
 evil far greater than that at which the legislation of 
 the past few years has been directed. And that is the 
 evil of monopoly charges and the inevitable conse- 
 quence from the trusting of so important a function 
 to private hands. This is an evil approved by law. 
 
 We have some means of knowing what the rail- 
 ways take in monopoly profits. That is shown by 
 their dividends. But we do not know what they 
 destroy. We have no means of knowing what the 
 productive power of the country would be were 
 the transportation agencies adjusted to the service 
 of the nation rather than to the service of the spec- 
 ulators of Wall Street. We cannot tell what would 
 be the effect upon the farmer and the manufacturer, 
 the jobber and the worker were railway management 
 concerned only with the convenience and comfort 
 
A FEUDAL SURVIVAL 147 
 
 of the community rather than with the making of 
 dividends. We cannot tell what the gain to the na- 
 tion would be were it not only freed from freight dis- 
 criminations and favors, but from the excessive 
 charges, and the desire for private advantage, which 
 now form the motives in the administration of the 
 highways of the nation. That can only be ascer- 
 tained when the railways become in fact, as they 
 are in legal theory, public carriers operated by the 
 government for the service of the community. 
 
CHAPTER XIII 
 
 " FROM HIM THAT HATH NOT SHALL BE TAKEN 
 AWAY EVEN THAT WHICH HE HATH" 
 
 Just as, under the feudal regime, the first-fruits 
 of the field were taken by the lord of the manor 
 as a tribute of his lordship, so to-day the owners 
 of the land take from those who toil a tribute in 
 the form of rent as an evidence of the same servi- 
 tude. Ground-rent is the continuing badge of feu- 
 dal servitude; a servitude which has come down to 
 us from the dark ages when force ruled the world. 
 The worker of to-day differs from the serf of the 
 Middle Ages in the form of the payment. Rent 
 is the money equivalent of the personal services 
 of earlier days. But despite the change which 
 has taken place in the form of the tribute, the mass 
 of the people are still subject to the most costly 
 incidents which feudalism involved. 
 
 We are now in a position to measure the tribute 
 which must be paid to those who own the land. 
 That which we can see runs into the thousands of 
 millions of dollars each year. It exceeds by hun- 
 dreds of millions all of the taxes paid to the na- 
 tion, the states, and the cities. It equals the com- 
 bined labor of America's 16,000,000 men at three 
 
 148 
 
"FROM HIM THAT HATH NOT" 149 
 
 dollars a day for at least fifty days in every year. 
 To-morrow it will be more than it is to-day. Long 
 before another generation passes it will be more 
 than doubled. For agricultural rent is just begin- 
 ning to grow. All land now has a monopoly value. 
 The rent to be paid must rise in consequence, for 
 rent is fixed by the demand for its use. 
 
 We have seen that the value of the land under- 
 lying the city of New York is $3,843,165,597. The 
 annual rent which its owners receive is not far 
 from $200,000,000. And this mine which under- 
 lies the city is inexhaustible. The treasure which 
 is taken out to-day in no way diminishes the treas- 
 ure which may be taken out to-morrow. Only 
 those who labor are the poorer because of its pay- 
 ment. They are carrying an annual burden greater 
 than the total interest charge on the national debt 
 at the close of the Civil War. And this is a charge 
 which is prior to all others. It is collected far 
 more accurately than are the taxes of government. 
 It must be met before any other activity is possible. 
 All of the people of the metropolis and, in a sense, 
 all of the people of America are subject to this 
 money tribute. It is exacted in the slum as it is 
 upon the avenue; it is collected from the office 
 building as it is from the tenement. It is a burden 
 upon all industry as it is upon all wages. It enters 
 into the cost of every commodity. It is the heav- 
 iest charge on the life of the people. Ground-rent 
 
150 PRIVILEGE AND DEMOCRACY 
 
 is the largest single item in the domestic budget 
 and it is all paid by labor. 
 
 It is the colossal land values of the city of New 
 York that drive up rents on the East Side; it is 
 the burden of rent that explains the 60,463 annual 
 evictions in the borough of Manhattan, and the 
 fact that one in every ten persons who die in New 
 York is buried at public expense in the potter's 
 field.' It is this that explains the thousands of 
 persons who nightly wait on lower Broadway for 
 a crust of bread. The rent charge of the metrop- 
 olis is equivalent to a per-capita burden of over 
 $50 per annum upon every man, woman, and child 
 in the city. It amounts to from $200 to $250 a 
 family. 
 
 The wealth with which the ancient estates of 
 England are being rehabilitated is being wrung 
 from the sweated labor of the East Side of New 
 York. It is the labor of America that is endow- 
 ing colleges and universities and libraries. It is 
 from the meagre wages of the most destitute of 
 God's creatures that the privileged classes of Eu- 
 rope and America maintain themselves in luxury. 
 Everywhere and in every age private ownership 
 of the land means aristocracy. Everywhere, too, 
 it means poverty. Everywhere it means a more 
 relentless struggle for existence, and a constantly 
 
 ' Poverty, Robert Hunter, pp. 24 and 25. The number of evic- 
 tions is for the year 1903. 
 
"FROM HIM THAT HATH NOT" 151 
 
 falling standard of living and ultimate national 
 decay. 
 
 To-day all America and, in a sense, all of the 
 world, is paying tribute to the baronial owners of 
 the land which underlies the Empire City. At 
 a thousand dollars a year a man must work ten 
 full centuries to earn one million dollars. Ten 
 thousand men at such wages must work half a 
 lifetime to pay a single year's rent of the people of 
 New York. Two hundred thousand men from the 
 workers of the metropolis must work for ten long 
 years, ten hours a day, and three hundred days 
 every year to pay the annual incomes of the few 
 thousand men who own the land underlying the 
 city. The most ruthless Roman governors sent 
 out to govern her subject provinces enjoyed no 
 such colossal tribute, and worked no greater dev- 
 astation upon subject peoples than that which 
 is annually inflicted upon the free citizenship of 
 America's greatest city. No wonder the vestibule 
 of the new world presents a spectacle of degraded 
 poverty to the million immigrants who annually 
 crowd to America to escape from the burden of 
 landlordism in foreign lands. 
 
 That which is true of the city of New York is 
 true wherever mankind has come together in great 
 cities. The annual increment in the value of city 
 land has created and is creating fortunes whose 
 colossal proportions so far exceed the needs of their 
 
152 PRIVILEGE AND DEMOCRACY 
 
 owners that the annual excess is used for the pur- 
 chase of still greater holdings.' 
 
 But rent is not limited to the agricultural tenant 
 or the slum dweller. It is paid upon the iron, the 
 coal, the oil, and the gas sites as well. Rent is the 
 annual value which arises from the superior ad- 
 vantages which one piece of land enjoys over an- 
 other. It may be a corner lot on Broadway, a 
 placer mine in distant Alaska, a lode of gold or 
 silver 10,000 feet above the sea in the Cripple 
 Creek regions. It may be a great deposit of Bes- 
 semer ore or of anthracite coal. The values which 
 the mineral lands enjoy are identical with the land 
 
 ' In 1900 the value of the land in the city of Philadelphia amounted 
 to $978,259,355. (Bulletin of Bureau of Labor, January, 1904, p. 
 106.) At five per cent, per annum, this is equivalent to an annual 
 charge of 844,000,000. It is a burden of over $200 upon the backs 
 of every family of five in the city. In fifteen years' time the 
 land underlying the city increased in value by $291,545,527, or 
 at the rate of $19,500,000 per year. The value of the bare land 
 in the city of Boston, together with the franchises of the public 
 service corporations, amounted to $842,600,000 in 1902. For five 
 years the average per annum increase was $21,753,000, or three and 
 three-quarters million dollars more than the annual revenues of the 
 city. In nineteen years' time the land in San Francisco increased 
 $175,000,000 in value, or $9,218,254 a year. This was nearly four 
 millions a year more than the total taxes of the city. In the city 
 of Washington the minimum increase in the value of the land was 
 $10,000,000 a year, or $2,000,000 more than all of the expenditure 
 of the city. If the naked land underlying these cities is worth these 
 sums, it is because human labor is paying rent which is equivalent 
 to the customary rate of interest on capital. City by city the ex- 
 hibit is the same. The annual increase in the value of the land 
 alone exceeds all of the expenditures of the community. The 
 speculative increase in values might all be taken in taxes and still the 
 owners would be richer each year than they were the year before. 
 
"FROM HIM THAT HATH NOT" 153 
 
 values of the country and the city. They spring 
 from no labor of the owner. They arise from no 
 skill of man. Only the necessities of humanity 
 give them a value, a value which increases with 
 every social activity. And the value which they 
 enjoy is a mortgage on labor, a mortgage as scru- 
 pulously collected as any government bond. The 
 capitalization of $800,000,000 placed upon the 
 iron-ore and coal lands of the Steel Corporation 
 is only possible because of the profits which the 
 trust may take from the people of America in the 
 form of rent. The franchises of the public service 
 corporations of the city of New York have a value 
 in the market of many hundreds of millions, only 
 because of the exclusive rights which they enjoy 
 upon the streets, rights which enable their owners to 
 collect from the labor of the metropolis from forty 
 to fifty million dollars a year in excess profits. If 
 the anthracite coal monopoly exacts from one to 
 two hundred million dollars a year from its con- 
 sumers in excess of the reasonable cost of producing 
 70,000,000 tons of coal, it is because the baronial 
 owners of north-eastern Pennsylvania have been 
 able to enclose one of the most precious sites on 
 the globe, a site which yields them a rental of this 
 amount every year.* If the railways of the coun- 
 
 'In the days of free competition anthracite coal sold at from 
 $2.55 to $3.00 a ton at seaboard. — The Anthracite Coal Industry, 
 Roberts, p. 74. It now sells for twice the figure. 
 
154 PRIVILEGE AND DEMOCRACY 
 
 try are capitalized at from five to seven billions 
 more than their reasonable cost of construction, it 
 is because the labor of the nation in some form or 
 other is paying dividends upon that sum. 
 
 The gross earnings of the railways of America 
 have doubled in ten years' time. The roads need 
 only to provide the service for a need already ex- 
 isting. And the tribute which they collect is de- 
 termined by the same necessity that forces up 
 rents in the tenement districts of our cities. It is 
 fixed by what humanity will bear.' 
 
 It is not possible to know the value of the mineral 
 deposits, of the coal and the iron, the copper and the 
 oil, the gas, gold, and silver mines which are largely 
 owned by the same syndicates which control the 
 railways of the nation. We do know that the an- 
 nual value of the mineral production of America 
 amounted to $2,069,289,196 in 1907.' Neither 
 can we tell the amount of the tribute exacted by 
 the street railways and the gas, the telephone, 
 
 ' In 1906 the gross earnings of the railways of the country were 
 $2,346,000,000. The net earnings from operation were $790,188,000. 
 While the operating expenses increased only nine per cent, for the 
 fiscal year, the net earnings increased over fifteen per cent. And it 
 is probable that if we knew all of the ramifications of the railway 
 business, all of the connections of railway directors with the ex- 
 press, the fast-freight, and the car lines; if we knew all of the hidden 
 means employed by these sympathetic agencies, we should find the 
 tribute imposed upon the nation by the owners of the highways in 
 excess of a fair return for the service performed, is not far from three- 
 quarters of a billion dollars a year. 
 
 2 The United States Geological Survey, special report, 1908. 
 
"FROM HIM THAT HATH NOT" 155 
 
 electricity, and the water companies. The value 
 of the franchise corporations of the country is esti- 
 mated by the Census Bureau at $4,840,000,000. 
 It is probable that the tribute which they exact 
 in the form of rent for the sites which they oc- 
 cupy is from $200,000,000 to $400,000,000 a year; 
 while that of the mine-owners exceeds the latter 
 sum. 
 
 When we add together the site values of the cities, 
 the unearned values of agricultural land, the fran- 
 chise values of the railways, transportation, trans- 
 mission, and public-service corporations, when to 
 this is added the social value of all of the mineral 
 resources of the nation, we have a grand total of 
 social values of from forty to sixty billion dollars. 
 We cannot tell how much it may exceed this sum. 
 But from the investigations of the census, of the 
 Interstate Commerce Commission, of the Geolog- 
 ical Survey, and of city assessment records, we know 
 enough to be sure that the above estimate is low. 
 The unearned increment probably amounts to 
 $1,000 per capita for every man, woman, and child 
 in the country. This would give an aggregate 
 social value of over $80,000,000,000. The assessed 
 value of the land and the franchises alone in New 
 York City amounts to $980, and in Manhattan bor- 
 ough to $1,376 per capita. In Boston the assessed 
 value of the land and the franchises amounts to 
 $1,100 per capita. These values do not include 
 
156 PRIVILEGE AND DEMOCRACY 
 
 the railways and the mineral resources of the coun- 
 try, but only the values of the city sites. 
 
 Upon this colossal sum the labor of America is 
 paying rent of from three to four billion dollars a 
 year. It amounts to from forty to fifty dollars 
 per capita, and from two hundred to two hundred 
 and fifty dollars per family. It is collected in a 
 thousand different ways. It enters into the cost 
 of every commodity. It reduces the standard of 
 living of all classes. And this tribute is all paid 
 by labor; not by labor of the wage-earner alone, 
 but by the labor of the professional man, the teacher, 
 the capitalist, and manufacturer. Alike, they are 
 all despoiled by the landlord. For rent can come 
 from no other source than labor. From out the 
 annual income of the nation, the landlord is the 
 first claimant to be satisfied. He and hunger com- 
 pete in the annual division of the product. 
 
 It is the labor of America that is supporting the 
 idle rich in the capitals of the world. It is labor 
 paid in the medium of rent upon the coal and the 
 iron-ore deposits of the United States Steel Corpora- 
 tion that enables the cities of America to be dotted 
 with libraries, just as it is the rent for the oil, the 
 copper, and the gas deposits that enables Mr. 
 Rockefeller to promote philanthropy and endow 
 great universities. 
 
 All society is yoked to those who own the land, 
 who work not nor spin. It is not necessary that 
 
"FROM HIM THAT HATH NOT" 157 
 
 they should work. For all mankind is working! 
 for them. Nature herself, who brings forth from 
 each of its kind, labors for those whose income is 
 proportionate to the resources which they have en- 
 closed. Every useful activity adds in some way 
 to the unearned increment of the land which is 
 society's own product. The achievements of every 
 walk of life are passed on and on until they finally 
 lodge with those who have filled their strong-boxes 
 with title-deeds of ownership of the gifts of God to 
 all his creatures. 
 
 While poverty is explained by immigration, by 
 improvident marriages, by the Malthusian law of 
 population, by the drink evil, by the inequalities 
 in the endowments of men, the real cause is nearer 
 at hand. It is to be found in the burden of rent, 
 which is slowly, but none the less finally, appropri- 
 ating the surplus wealth of the people. 
 
 Among the mythological traditions of the ancient 
 Greeks is the story of a wise and wealthy king whom 
 the gods themselves delighted to honor. They per- 
 mitted him to dine with Zeus, who loaded him with 
 distinctions because of his wisdom. Yet the king 
 presumed upon his privileges and favors. Not 
 content with the honors which he enjoyed, he stole 
 the food reserved for the gods. In other ways he 
 transgressed the privileges of mortals. His crimes 
 finally gave such offence to the gods, that he was 
 condemned to eternal punishment in Tartarus, a 
 
158 PRIVILEGE AND DEMOCRACY 
 
 vast and gloomy expanse far below Hades itself. 
 Here he was tortured by an ever-burning thirst. 
 He was plunged into water up to the chin. When 
 he sought to drink, the water receded from his 
 parched lips. He was consumed with hunger. 
 Just above him were tall trees; their spreading 
 branches laden with delicious fruits hung tempt- 
 ingly over his head. But no sooner did he raise 
 himself to seize them than a wind carried them 
 beyond his reach. Thus Tantalus lived within 
 easy reach of abundance with which to satisfy his 
 wants, condemned, by his own unwisdom, to eternal 
 hunger and thirst. 
 
 Free America, rich, wise, and endowed with re- 
 sources more ample than all the rest of the earth, 
 has ventured to violate the experience of all his- 
 tory and the teachings of all nature. She has 
 abandoned the resources with which she was en- 
 dowed to private monopoly. 
 
 Herein is the paradox of civilization; herein is 
 the explanation of increasing poverty with in- 
 creasing wealth; herein is the law of civilization 
 and decay. For whatever the exertion of the 
 worker, whatever the gains to production, they in- 
 evitably pass to those who own the soil. In time 
 the growth of population will lead men to offer 
 more than the land will produce for its use. They 
 will offer this as a stay of execution, just as a con- 
 demned criminal seeks a reprieve from a death 
 
"FROM HIM THAT HATH NOT" 159 
 
 penalty which he knows to be inevitable. For the 
 increase in rent reduces the portion retained by 
 labor, until it becomes less than life itself demands. 
 Progressive impoverishment then sets in, and na- 
 tional decay results in national ruin. 
 
CHAPTER XIV 
 SOME OF THE COSTS OF LAND MONOPOLY 
 
 But the increasing burden of rent is not the 
 only sacrifice which the private ownership of the 
 land involves. Private land ownership is to the pro- 
 duction of wealth what a ball and chain would be 
 to a runner, or a kedge anchor to a racing sloop. 
 We have no means of knowing how much wealth 
 would be produced were the land and its opportuni- 
 ties unlocked and opened up to labor. 
 
 As we have seen, the population of America is 
 but 28 to the square mile. This includes the thirty 
 odd millions who dwell in cities. The people of 
 Germany dwell 280 to the square mile, of France 
 188, and of contented Switzerland 218 to the mile. 
 Were America peopled as snugly as are these Euro- 
 pean countries, our population would range from 
 500,000,000 to 800,000,000 souls. Nor is this popu- 
 lation of ours made up of home-owners. As we 
 have seen, 35.3 per cent, of the farms of America 
 are worked by tenants, while only 54.9 per cent, 
 are free from some encumbrance or other. At the 
 same time over 200,000,000 acres are in the hands 
 of less than 50,000 persons, the average size of 
 whose holdings is 4,237 acres. This is one-fourth of 
 
 160 
 
THE COSTS OF LAND MONOPOLY 161 
 
 the total cultivated area of the country. It exceeds 
 the combined area of Great Britain and France. 
 
 These plantation estates are scattered all over 
 the West. Some of them exceed a million acres in 
 extent, and many of them exceed a hundred thou- 
 sand. They are held for speculation or grazing. 
 Those that are cultivated at all are worked by 
 hired men. These workers are cheaper than the 
 slaves of the plantation-owners of the South. They 
 come to the employer mature and able-bodied. 
 They involve none of the hazards of rearing or 
 purchase. When no longer efficient, when sick 
 or disabled, others are there to take their place. 
 
 It is land monopoly that limits the population 
 of a great part of the West to the "hands" neces- 
 sary to cultivate the estates. It is land monopoly 
 that converts great prairie stretches, capable of 
 maintaining millions of men in comfort, to the 
 grazing of cattle. It is this that encourages the 
 least productive forms of agriculture, and involves 
 the consequent increase in the cost of all the neces- 
 sities of life. 
 
 That which is true of a great part of the West is 
 increasingly true of other sections of the country as 
 well. In the mountain regions of the Carolinas, 
 of Tennessee, West Virginia, and Kentucky, in 
 Florida and in Virginia, the farmer is being driven 
 out by the Northern capitalist. Men whose grand- 
 fathers and great-grandfathers broke through from 
 
162 PRIVILEGE AND DEMOCRACY 
 
 the sea-coast, in the seventeenth and eighteenth cen- 
 turies, are selHng their holdings at an insignificant 
 price to speculators, who are denuding the moun- 
 tain-sides of the forests, who are holding great 
 areas out of use because of the mineral resources 
 deposited in them, or are developing them as private 
 estates. Men who now work these forest preserves, 
 or labor in the mines, were once their owners. 
 Where formerly there was industrial freedom, 
 now there is industrial servitude. Others have 
 gone to the towns, where they quickly dissipate 
 the insignificant sums received for their holdings. 
 In the mill regions of the South one finds the chil- 
 dren of these small farm-owners at work in the 
 cotton mills. Many of them not yet in their teens 
 work from ten to fourteen hours a day. Here they 
 become aged before their time, the victims of dis- 
 ease and of unsanitary surroundings. Here they 
 labor in great numbers from early morn till late 
 at night, and from early youth to the grave, in the 
 fetid atmosphere of the Southern mill. 
 
 It is very generally assumed that ownership of 
 the land is necessary to efficient production. A 
 little reflection will show that this is not true. The 
 right to own the product has nothing whatever to 
 do with the right to own the land. Society would 
 not hold together for a season did it not assure to 
 him who ploughed the ground and made it ready 
 for the harvest the right to enter on the fields and 
 
THE COSTS OF LAND MONOPOLY 163 
 
 gather the crops. It is assurance of a right to the 
 product that stimulates production, a stimulus that 
 is wanting to an increasing percentage of agricult- 
 ural workers of America who form the tenant 
 class. 
 
 Were one of our acquaintances to erect a pa- 
 latial residence in the heart of the city; were he to 
 gather together from every quarter of the world 
 the works of art and refinement; were he to fill it 
 with the most costly plate and the most beautiful 
 Gobelin tapestry; were he to line its walls with 
 marble from the famous quarries of Carrara, and 
 its polished floors with Persian rugs; were he to 
 prepare a house as if for a princess, and then turn 
 it over to his hounds as a kennel, a commission 
 of lunacy would be appointed by his friends, and 
 the control of his property would be taken from 
 him. 
 
 Yet America has done far worse than this. En- 
 dowed with land for many times our present popu- 
 lation, we have closed that opportunity against 
 ourselves. We are repeating the most colossal mis- 
 takes of history. Just as the highlands of Scot- 
 land, which produced the hardiest of Great Brit- 
 ain's people, have been cleared of humanity to 
 make sheep farms and hunting preserves for the 
 aristocracy, so a large part of America has been 
 parcelled out into great plantations owned by cor- 
 porations and individuals. Speaking of the "clear- 
 
164 PRIVILEGE AND DEMOCRACY 
 
 ances" of Scotland, the British scientist, Alfred 
 Russel Wallace, says: 
 
 "The motive for these clearances is usually to 
 obtain a larger or securer rental for the land, either 
 as sheep farms or as deer forests; and for this pur- 
 pose tens of thousands of British subjects have 
 been driven from their homes, often to swell the 
 mass of indigence and crime in the great cities, while 
 the country is being denuded of a hardy, industrial, 
 moral, and intelligent population to which our army 
 has been indebted for men and officers who, in India 
 and elsewhere, have done the noblest deeds, and 
 added to the nation's roll of fame. Such clearances 
 are a deep injury to the state and a positive crime 
 against humanity, of the same nature (though less 
 in degree) as despotism or slavery. Yet they are 
 legal; and no power exists which can prevent them, 
 so long as the land, without which no man could live, 
 is allowed to be monopolized by the rich." ' 
 
 That which is true of Scotland is true of England 
 and Ireland as well. By means of the enclosure 
 acts and the exemption of the land from direct 
 taxation, by means of settlements and entails, the 
 land of Great Britain is more closely held than any- 
 where else in the world. According to the British 
 Doomsday Book of 1875, 1,200 persons own one- 
 quarter of the soil of England, Ireland, Scotland, 
 and Wales. The average size of these estates is 
 16,200 acres. Another quarter of the land is owned 
 by 6,200 persons, whose holdings average 3,150 
 
 ' Land Nationalization, p. 180. 
 
THE COSTS OF LAND MONOPOLY 165 
 
 acres. In Scotland the land is even more closely 
 owned. A single owner is possessed of more than 
 a million and a quarter acres. Seventy persons own 
 one-half of the land, and 1,700 nine-tenths of it. 
 In Ireland the conditions are the same. In that 
 unfortunate land two-thirds of the soil is owned by 
 1,700 landlords. Great Britain is carved up into 
 great territorial estates like those of France under 
 the feudal regime. 
 
 A great part of the land is used for hunting pre- 
 serves and idle pleasure. Much of it is devoted 
 to the grazing of cattle and indifferent cultivation. 
 But an insignificant portion is cultivated intensely, 
 and practically all of it is worked by a tenant class. 
 Less than one-fifth of the population is engaged in 
 agriculture. The nation is face to face with the 
 problem of poverty produced by the rack-rents of 
 country and city and the exclusion of humanity 
 from the land, while a handful of landlords enjoy 
 rent-rolls running into the hundreds of millions of 
 dollars. In this is to be found the explanation of 
 Britain's decay. For nearly eight millions of her 
 people live on the border-land of starvation, and 
 fully two-thirds are very poor. One person out 
 of seven dies in a public hospital, asylum, or work- 
 house. In the cities of London and Liverpool one 
 person in every four dies in some public institu- 
 tion. Nearly fifty per cent, of the army candi- 
 dates from the cities are rejected as physically un- 
 
166 PRIVILEGE AND DEMOCRACY 
 
 fit for service, while the condition of the peasant 
 class is but little better. 
 
 These are the fruits of land monopoly in Great 
 Britain, where the withholding of the land from 
 use and the competitive rents for that which is 
 used have reached their final consequences. They 
 are not dissimilar from the conditions which im- 
 poverished Ireland a generation ago. 
 
 But the costs of land speculation are not con- 
 fined to the agricultural worker. They are not 
 limited to the tenant class on the plantations of 
 the West. The cost of monopoly is scarcely less 
 obvious in the mineral resources as well. 
 
 In the upper lake regions of Minnesota, Wiscon- 
 sin, and Michigan are to be found the most mar- 
 vellous iron-ore deposits in the civilized world. 
 Not far away are similar deposits of copper. All 
 through the central West are coal, oil, and gas ade- 
 quate for the needs of generations. Yet the amount 
 of iron, the amount of copper, the amount of coal, 
 oil, and gas that humanity may use is determined 
 by those who have appropriated these deposits. 
 The supply is doled out as cupidity or greed may 
 determine. The resources of the earth are closed 
 to labor and industry. Humanity is warned off the 
 land in order that the prices of these great ne- 
 cessities may be fixed by the needs of life itself. 
 
 In the anthracite fields of Pennsylvania are great 
 areas of coal lands that are not operated. Upon 
 
THE COSTS OF LAND MONOPOLY 167 
 
 this supply the life of the Eastern seaboard de- 
 pends. Yet it is surrounded as by a Chinese wall. 
 Labor may not enter and no fuel may go forth ex- 
 cept on the terms which monopoly dictates. A 
 generation ago competition prevailed in these 
 regions. Then the output of coal was governed 
 by the same law which regulates the output of 
 wheat, of potatoes, of shoes, of clothes, of all those 
 commodities which are governed by the law of 
 competition. Under competitive conditions prices 
 are fixed by the relative amount of labor which 
 enters into each commodity. There is no overpro- 
 duction of these things. Society instinctively pro- 
 duces what it needs with something like divine 
 foresight. And in the days when competition 
 ruled in the anthracite coal-fields, the price of coal 
 at the seaboard ranged from $2.55 to $2.60 a ton. 
 Twenty years ago it sold for $3.00 a ton.' To-day 
 it sells for approximately $6.00 a ton. It is fixed 
 by the railroad syndicate which controls the region. 
 A generation ago there were more than a hun- 
 dred operators in this field. Each operator strove 
 for the greatest economy in production, and the 
 best market for his output. The railways and 
 canals were eager for traffic. They sought the con- 
 venience of the shipper. The operator had no dif- 
 ficulty in securing cars. He was offered compet- 
 ing outlets to the seaboard. Finally the railroads 
 
 ' The Anthracite Coal Industry, Roberts, p. 74. 
 
168 PRIVILEGE AND DEMOCRACY 
 
 entered the mining business. Then they discrim- 
 inated against the independent operator. They 
 refused to give him cars. In time they crushed him 
 out and acquired control of his property. Com- 
 petition was ultimately destroyed. To-day the 
 coal is bottled up as completely as were the Rus- 
 sians at Port Arthur. There is opportunity here 
 for labor, limited only by the needs of man. But 
 the storehouse of nature has been closed, and the 
 railroads carry the keys. They have decreed that 
 only a limited portion of the capacity shall be 
 worked. Prices are maintained by charging "what 
 the traffic will bear," while labor is excluded from 
 the opportunity of employment. By this process 
 they exact from the life and industry of the country 
 at least $2.00 a ton more than was paid in the days 
 of free competition. 
 
 In our cities the cost of land monopoly is equally 
 manifest. The speculator retards development. 
 He strangles the city. It is estimated that at least 
 one-half of the area of every large city is inade- 
 quately developed. It is held for the purposes of 
 speculation or covered with "tax earners." A 
 scarcity value is created. On such land as is used 
 rents are forced up in consequence. The private 
 dwelling gives place to the apartment house. Where 
 once there were homes now there are tenements. 
 City land values have become prohibitive to the 
 great mass of people. Only a diminishing minor- 
 
THE COSTS OF LAND MONOPOLY 169 
 
 ity own their own homes. They could build and 
 would build were it not for the initial cost of the 
 land. Labor is thus limited in its opportunities, 
 as is the production of other wealth. 
 
 City building is strangled by the same influences. 
 Streets are cramped; beauty is subordinated to the 
 use of every inch of soil. Great public improve- 
 ments are rendered impossible. The building of 
 schools and libraries, the opening of parks and play- 
 grounds, the development of docks, the making of 
 the city what it should be, are throttled by the 
 land monopolist, whose dead hand makes the cost of 
 city building prohibitive. 
 
 Everywhere untouched resources in abundance. 
 Everywhere land inviting labor to bring forth 
 wealth for our use. Close beyond the walls of the 
 city, with its disease-breeding slums and tenements, 
 is land upon which homes could be erected did its 
 price not prohibit its purchase. Mines, forests, 
 quarries, and resources more ample than those of 
 all Europe, are kept out of use by the monopolist 
 and speculator. Within our cities are strength, 
 talent, and genius, trained by a system of universal 
 education and eager for the expression of their life. 
 So eager is labor for a chance, and so limited are its 
 opportunities for expression, that the sweat-shops 
 are crowded to suffocation, while the mining regions 
 swarm with men fighting for a chance to spend 
 their lives underground. At the same time millions 
 of men are constantly out of employment, while 
 
170 PRIVILEGE AND DEMOCRACY 
 
 millions more are on the dead-line of poverty. 
 Between labor and opportunity the land-owner 
 has drawn a dead-line which may not be crossed. 
 
 Were a syndicate from Wall Street to gather 
 together all of the bread of the city of New York; 
 were it to say to the people of the metropolis, 
 "You may have so much food as we daily deter- 
 mine, on condition that you labor for us a certain 
 number of days each week, " riots would ensue, riots 
 which the police and militia could not check. Yet 
 such is the notice which has been served upon 
 America. For land is as essential to life as bread 
 itself. It is the source of all wealth. 
 
 Charles Stewart Parnell used to quote with ap- 
 proval, in explanation of the misery of his own 
 unhappy land, the following words of Henry George: 
 
 ' ' Man is a land animal. A land animal cannot live 
 without land. All that man produces comes from 
 the land; all productive labor, in the final analysis, 
 consists in working up land or materials drawn 
 from land into such forms as fit them for the satis- 
 faction of human wants and desires. Man's very 
 body is drawn from the land, and to the land we 
 must return. Take away from man all that belongs 
 to the land, and what have you but a disembodied 
 spirit? Therefore, he who holds the land on which 
 and from which another man must live is that 
 man's master, and the man is his slave. The man 
 who holds the land on which I must live can com- 
 mend me to life or to death just as absolutely as 
 though I were his chattel. Talk about abolish- 
 ing slavery — we have not abolished slavery; we 
 
THE COSTS OF LAND MONOPOLY 171 
 
 have only abolished one rude form of it, chattel 
 slavery. There is a deeper and more insidious 
 form, a more cursed form yet before us to abolish, 
 in this industrial slavery that makes a man a virt- 
 ual slave, while taunting him and mocking him in 
 the name of freedom." 
 
 It is only the ingrained usage of generations 
 that blinds our eyes to the devastating effects of 
 the private ownership of the land. It is far more 
 costly than the tariff, far more ruinous than dis- 
 criminating freight rates. It is not so much the 
 burden of rent, it is the strangling of wealth 
 production that makes the private ownership of 
 the land so costly. It affects the industrial life 
 of a people like an invading army. It is not the 
 burden of its maintenance that makes it so costly, 
 it is the abandoned fields, the deserted workshops, 
 the confusion to all trade and industry, and the 
 blight which settles on the country which makes a 
 defensive war so exhausting. It is not the amount 
 destroyed, it is the wealth that is never pro- 
 duced that measures the cost. At the close of the 
 Franco-Prussian war an indemnity of one billion 
 dollars was exacted from the people of France. 
 This colossal tribute was paid with comparative 
 ease. But had the nation been devastated by an 
 army of occupation, had the mills and the factories 
 been closed, had the peasants been driven from the 
 fields, as were the people of the Southern States of 
 
172 PRIVILEGE AND DEMOCRACY 
 
 America, such an indemnity would have been out 
 of the question. It could not have been paid by 
 a prostrate people. 
 
 And it is the wealth which is never produced by 
 the labor which is never employed, or is badly em- 
 ployed, that measures the loss from the private 
 ownership of the land. This is the costliest price 
 of all. And the correction of this injustice has en- 
 gaged the attention of almost every people, from 
 the early Hebrews down to the land of legislation 
 of Great Britain to-day. In some form or other 
 the agrarian question is uppermost in every coun- 
 try of Europe, but it is only in far-off New Zealand 
 and New South Wales that a democratic solution 
 is being tried, a solution that not only recognizes 
 the right of the community to the unearned in- 
 crement in the value of the land, but strikes at the 
 root of land monopoly by forcing the owner either 
 to use that which he holds or to sell it to some one 
 who will.' 
 
 ' England herself is following in the footsteps of her colonies. The 
 Liberal budget for the year 1909 was avowedly a social as well as a 
 fiscal measure. In presenting it to the House of Commons the 
 Chancellor of the Exchequer, Lloyd George, said that its purpose 
 was to stimulate the use of the land and aid in the breaking up or 
 forcing into use of the land which was held idle in the kingdom. 
 The means employed was the taxation of undeveloped land on its 
 capital value. The rate of taxation imposed was not high, but the 
 promoters of the measure undoubtedly contemplated the increase 
 in the rate as soon as a valuation had been made or the cities and local 
 authorities had been authorized to levy a local rate on land values. 
 It was the fear of this that influenced the House of Lords to reject 
 the measure. 
 
CHAPTER XV 
 THE FUTURE OF LABOR 
 
 From now on the struggle for existence will in- 
 crease in intensity. From now on the cost of liv- 
 ing will be more exacting. The chance for a decent 
 human existence is daily narrowing. The number 
 on the border-line of poverty is constantly increasing. 
 All this is inevitable. For the supply of land is 
 constant, and a large part of it is kept out of use. 
 The demand for standing-room is increasing with 
 every tick of the pendulum of time. 
 
 The real explanation of the labor problem is ob- 
 scured by the appearance of things, by the wages 
 system, and the struggles of capital and labor. We 
 do not see through the industrial question into the 
 real struggle of classes which lies back of it all. 
 For lack of employment, hard times, the wages 
 question, and the poverty everywhere appearing 
 are but part of a larger problem, a problem which 
 can only be cured by going back to its cause, a 
 cause which is to be found in the private owner- 
 ship of the land and the resources of the nation. 
 
 This being true, labor can no more improve the 
 general standing of living by organization than a 
 man can lift himself by his boot-straps. Trades- 
 
 173 
 
174 PRIVILEGE AND DEMOCRACY 
 
 unionism may maintain the scale of wages in certain 
 trades; it may even increase nominal wages in the 
 highly skilled industries. But even in these trades 
 the improvement will be only an apparent one.' 
 For the increase in the cost of living will more than 
 absorb the increase in nominal wages. No array of 
 statistics can modify this tendency, a tendency 
 which has been very manifest during the past few 
 years. But the investigations of public and pri- 
 vate agencies show that wages have not been ris- 
 ing as rapidly as has the cost of living. It 
 cost fully one-third more to maintain life in 1905 
 than it did eight years before. Wholesale prices 
 were higher in 1905 than at any time in the recent 
 history of America. It required $1.30 to purchase 
 as much in that year as was attainable for $1.00 
 in 1897. It is estimated that during the ten years 
 prior to 1907 the cost of living went up forty per 
 cent., while the wages for unskilled labor remained 
 practically stationary. During this period the 
 wages of organized labor increased but seventeen 
 per cent., and organized labor as a whole does not 
 include more than three million of America's work- 
 ing population.'' 
 
 1 As a matter of fact even nominal wages have fallen. The Censtis 
 Bulletin on Manufactures, covering thirty-three states, shows that 
 whereas the average wage in 1890 was $418.48 a year or $1.39 a day, 
 in 1900 the average wage was but $397.53 a year or $1.29 a day. 
 
 ' The Bulletin for the United States Bureau of Labor for March, 
 1908, presents a study of the variations in the wholesale prices of 
 
THE FUTURE OF LABOR 175 
 
 But nominal wages form only one factor in the 
 equation of real wages. The actual income of 
 any class can only be ascertained by the amount of 
 goods which the income of that class will purchase. 
 Wages are high or low, according to the comfort 
 and happiness of the worker. Nominal wages may 
 be very high, as they are in the Yukon or in 
 the new mining camps of the West, but if every 
 cent that is received is expended for the barest ne- 
 cessities of life, real wages are very low. 
 
 It is the unskilled worker who is suffering most 
 from the increasing cost of living. And the un- 
 skilled laborer comprises at least two-thirds of the 
 working population. He does not organize. His 
 employment is precarious. His work is of transi- 
 tory nature. There is no cohesive trade sympathy 
 to keep him united with his fellows.' The agri- 
 cultural worker falls into the same class. He, too, 
 is suffering a progressive diminution in his wages 
 as well as in his standard of living. The same is 
 true of the salaried and professional classes. 
 
 From now on the cost of the necessities of life 
 must continue to increase. This is already apparent 
 
 258 representative articles from 1890 to 1907. It states that the 
 average price of all articles for the year 1907 was 44.4 per cent higher 
 than that of 1897. 
 
 1 The Journal of Political Economy (June, 1905, p. 359), in a scien- 
 tific analysis of the wages of unskilled labor shows that "the wages 
 of common laborers remained practically unchanged from 1890 to 
 1900, " while the increase in the cost of Uving has materially reduced 
 their real wage. 
 
176 PRIVILEGE AND DEMOCRACY 
 
 in rent. The increase in the tenement districts of 
 New York has been so rapid as to lead to organized 
 resistance. The cost of coal, of beef, of foodstuffs, 
 of cotton, of leather, of wool, of transportation, of 
 coal, iron, copper, of all of the elemental products 
 which come directly from the land, has been going 
 up with great rapidity during the past few years. 
 
 This increase in the cost of living is due to mo- 
 nopoly in its various forms, but most of all to the 
 monopoly of the land and the storehouse of nature.* 
 It is this that limits labor to the job that is nearest 
 at hand; it is this that herds population into the 
 cities; it is this that closes the resources of nature 
 to humanity and strangles the production of wealth. 
 While men and women are suffering from cold and 
 hunger all over the land, the cotton-growers are 
 destroying their cotton in the fields of the South 
 in order that they may obtain an increased price 
 for that which remains. A great part of the coal 
 land of the country is withheld from production 
 in order that a scarcity price may be exacted for 
 that which is used. Hundreds of millions of fertile 
 acres are kept out of tillage in the West, and to 
 an increasing extent in the East as well, for the 
 purpose of speculation. The railways in many in- 
 stances fix their charges at the point which will 
 absorb everything that the farmer produces and still 
 
 'The percentage of increase in rent from 1897 to 1902, aB ascer- 
 tained by the Labor Bureau of Massachusetts, was 52.43 per cent. 
 
THE FUTURE OF LABOR 177 
 
 keep him at the plough. The packing-houses and 
 warehouses have adopted the same rule of charges. 
 They depress the price of raw material on the farm, 
 and by a similar understanding exact all that the 
 consumer can pay at the other end of the line. 
 The sugar, tobacco, beef, leather, wool, iron, steel, 
 oil, and copper monopolies screen themselves be- 
 hind a tariff wall, and collect such tribute as their 
 owners see fit to charge through their alliance with 
 the government and the transportation agencies 
 of the nation. It is these influences that are in- 
 creasing the cost of living in America. And so 
 long as man remains a land animal and the people 
 permit the highways to be privately owned and 
 used for stock-gambling purposes, the cost of living 
 must continue to increase. 
 
 The landlord is the paymaster of all other classes. 
 He limits the opportunities of labor and profits by 
 every babe that is born. For the growth of popu- 
 lation is increasing the demand for standing-room. 
 It raises the rent which must be paid for its use as 
 well as the cost of all the necessities of life. So- 
 ciety increases the value of the land, and then is 
 charged a tribute for that which it has created. 
 
 When one contemplates the methods which have 
 been pursued in the abandonment of our public 
 lands, it seems as though our policy had been in- 
 spired by the employing classes, just as is the 
 immigration of cheap labor from Europe. For had 
 
178 PRIVILEGE AND DEMOCRACY 
 
 the lands been opened up to use only as they 
 were actually needed by settlers, wages would 
 have continued to rise for many generations to 
 come, while homes for many times our present 
 population would have been available. Then the 
 employer would have been forced to compete with 
 the free lands of the West. Under these condi- 
 tions labor would have continued to receive some- 
 thing like the full value of its services. For wages 
 are determined by the existence of free lands and 
 the outlet which they offer to increasing population. 
 When such an alternative exists it is not necessary 
 for men to shift their employment to agriculture 
 in order to secure the full return of their labor. 
 The very existence of an alternative automatically 
 keeps wages at the amount or somewhere near 
 the amount that can be produced on the free land. 
 
 But the enclosure of the public lands has de- 
 stroyed this alternative. The worker is reduced 
 to a competitive scale. His wages are determined 
 by the hunger of those outside of the gates of the 
 factory. The alternative of being a free man, 
 upon a farm of his own, is now gone forever. 
 
 That free land is the determining factor in fix- 
 ing wages has been recognized by at least one 
 economist. 
 
 "Free land being given," says Achille Loria, 
 "the division of society into a class of non-labor- 
 ing capitalists, and a class of non-capitalistic la- 
 
THE FUTURE OF LABOR 179 
 
 borers, is, in either case, out of the question; for, 
 under such circumstances, it is impossible for an 
 idle capitalist to acquire any profit. 
 
 "Colonial countries where free lands abound 
 offer striking illustrations of these propositions, and 
 any one who has rightly comprehended the devel- 
 opment of these interesting lands must recognize 
 the truth of our assertions. Note, for example, in 
 the descriptions of the early days of the United 
 States, how this fortunate country is depicted as 
 inhabited by a noble race of independent laborers, 
 ignorant of the bare possibilities of capitalistic 
 property; read Washington's letters, which tell 
 how impossible the farmers found it to acquire 
 any income whatever from their lands unless they 
 cultivated them along with their laborers; and 
 mark how Parkinson, Strickland, and other Euro- 
 peans who travelled in America during the eigh- 
 teenth century, were one and all struck with amaze- , 
 ment at this strange land where money did not 
 breed money. We can also understand why the 
 slave system of the ancient world and the serf- 
 dom of the middle ages were both reintroduced 
 into our modern colonies; for it was only by re- 
 sorting to such means that profits could be acquired 
 during these epochs preceding the appropriation 
 of the soil."' 
 
 We are fearfully afraid of names and phrases in 
 America. We resent the suggestion of "industrial 
 servitude." Do not our written constitutions de- 
 clare that "there shall be no slavery nor involun- 
 tary servitude" within the commonwealth? Are 
 we not protected by manhood suffrage and the 
 
 ' Economic Foundations of Society, p. 3. 
 
180 PRIVILEGE AND DEMOCRACY 
 
 guarantees of personal freedom? But economic 
 laws recognize no bill of personal rights, and eco- 
 nomic servitude is no more incompatible with Magna 
 Charta and the Declaration of Independence than 
 it is with the despotism of the czar. We can en- 
 slave ourselves through the forms of democracy as 
 completely as we may be enslaved by the Sultan of 
 Turkey. And chattel slavery has probably disap- 
 peared among the civilized nations as much through 
 the change in economic conditions as through the 
 growing humanity of man. Cheap labor was only 
 possible by legalized slavery when free land was open 
 to all. Then the slave could only be kept in subjec- 
 tion by positive law. But as soon as all of the land 
 had been taken up, the necessity as well as the econ- 
 omy of chattel slavery disappeared, and the relation 
 of employer and employee, of landlord and tenant 
 arose to take its place. It is probable that the labor 
 cost of the bonanza farms of the West is far less than 
 the labor cost on the plantations of the South prior to 
 the Civil War. Free labor is more efficient than 
 slave labor. The slave must be reared to maturity. 
 He must be maintained in a certain degree of physi- 
 cal efficiency. He must be cared for in old age. 
 Slave labor is notoriously shiftless. It is inspired 
 neither by the hope of reward nor the fear of want. 
 The wage-earner, on the other hand, comes to the 
 employer with none of the costs of rearing. He is 
 impelled by the hope of promotion and the fear of 
 
THE FUTURE OF LABOR 181 
 
 hunger, and his place may be filled at any moment 
 by an advertisement in the newspaper. 
 
 It must be evident that from now on wages will 
 tend to the margin of subsistence. What does it 
 cost to feed, clothe, and keep the average worker 
 from starvation? That is the measure of his cost 
 to the employer. His price is fixed, just as is the 
 price of competitive commodities, by the cost of 
 production. The struggle of increasing popula- 
 tion against diminishing opportunity, of increasing 
 consumption against decreasing supply, will reduce 
 wages to the margin of subsistence, just as the in- 
 come of the cottier tenant in Ireland was reduced to 
 a potato diet by the hunger of others, eager to offer 
 all that they could produce for the mere privilege 
 of having a place upon the earth whereon to work. 
 
 We can see this process already at work wher- 
 ever land monopoly is most complete. It is evi- 
 dent in the tenement districts of our cities, where 
 the struggles of surplus labor, of rack-renting, and 
 of periodic evictions form the saddest sights of the 
 slums. It is manifest in the anthracite and bi- 
 tuminous coal regions, where the miner is reduced 
 to a bare subsistence wage, and is kept in such a 
 state of dependence by the operators that he can- 
 not even protest against the death-traps wherein 
 he must either labor or starve. 
 
 We can see the reduction of labor to a subsist- 
 ence wage in every great city. There every material 
 
182 PRIVILEGE AND DEMOCRACY 
 
 advance expresses itself. There men and women 
 work with greatest intensity, while labor-saving 
 machinery is most highly developed. There labor 
 is most minutely divided. In the cities wealth is 
 produced with the minimum of manual labor. 
 And here the per capita production is greatest. 
 There, then, we should expect civilization to flower 
 into universal well-being. There want should be 
 confined to those whom illness or idleness has con- 
 demned to it. Yet, in every one of our large cities, 
 at least one-quarter of the people are hovering 
 upon the border-line of want or are actually en- 
 gulfed in poverty. Another quarter are struggling to 
 maintain an existence that varies from that of com- 
 fort to one that is far from enviable, while a small 
 group are enjoying incomes far in excess of all hu- 
 man needs. 
 
 Wherever the monopoly of the land is most com- 
 plete, there the fiercest wars of labor and capital 
 have taken place. Labor does not organize in a 
 newly discovered mining region, for every worker is 
 a prospector. He works for himself. It is only 
 when monopoly has laid its hand upon the region 
 and enclosed the opportunity for independent min- 
 ing, that the wages system comes into existence. 
 In the early days of California, wages were fixed 
 by the returns of the independent prospector. No 
 one would work for another for less than he could 
 produce from his own claim. The same was true 
 
THE FUTURE OF LABOR 183 
 
 in the early days of the Alaskan gold-fields and the 
 Tonemah and Goldfield districts in Nevada. The 
 great labor wars of these districts followed close 
 upon the monopoly of the regions. So long as op- 
 portunity was free there was no conflict, for the 
 worker could change his hand at will. 
 
 The history of all mining regions is the same. 
 There were no serious strikes in the anthracite coal- 
 fields so long as competition prevailed. "Before 
 the Civil War amicable relations prevailed between 
 the co-operative forces. Then in the majority of 
 collieries employer and employes lived side by 
 side, and could peaceably adjust their differences. " * 
 But where formerly there was peace, now there is 
 recurrent industrial warfare. Not only warfare, 
 but the most complete subjection of the worker. 
 Three-quarters of a million people are dependent 
 upon the will of a half-dozen men who determine 
 over a luncheon whether there shall be work or 
 idleness, as to what those who labor shall receive 
 in wages, and when their labor is over, what they 
 shall pay to the mine-owners for the necessities of 
 life. 
 
 Organized labor is correct in its diagnosis. It is 
 correct in speaking of the servitude of labor. But 
 servitude is not confined to those who work at the 
 bench or in the mill, in the mine or in the factory. 
 Servitude is a condition into which all classes are 
 
 ' The Anthracite Coal Industry, Roberts, p. 104. 
 
184 PRIVILEGE AND DEMOCRACY 
 
 born, in every nation and under every flag, where 
 the right to use the earth is dependent upon the will 
 of another. And the servitude has been the same, 
 whatever the form of the tribute, from the age of 
 serfdom down to the present day. And it rests 
 upon all alike, whether they work with their hands 
 or their brains, whether they be skilled or unskilled, 
 whether they be artisans, artists, professional men, 
 or capitalists. It is the servitude of those who 
 labor to those who labor not at aU. 
 
 And the results which follow from the private 
 ownership of the land are as immutable as the laws 
 of nature herself. That rent is the great absorb- 
 ent, gathering to itself an increasing portion of the 
 wealth which is produced, is so obvious a fact that 
 it should be the fundamental postulate of poUtical 
 economy. That the ultimate consequence of this 
 phenomenon is the impoverishment of capital as 
 well as labor, may be seen on every hand. That it 
 leads to an ignorant and impoverished peasantry 
 on the one hand, and an idle and irresponsible 
 aristocracy on the other, is the experience of aU 
 nations. And we cannot hope to escape the con- 
 sequences of these laws in America through any 
 declaration of political freedom any more than 
 the superstitious savage can ward off disease by 
 incantation and sacrifice. 
 
CHAPTER XVI 
 
 THE DISTRIBUTION OF WEALTH 
 
 , The production of wealth enlists the co-operation 
 of all learning. It engages the best thought of sci- 
 ence. It is promoted by every agency of govern- 
 ment. We know to a fraction the cost of every 
 commodity and the annual value of our output. 
 The increase in the production of wealth is heralded 
 to the world, as is every invention which stimu- 
 lates the efficiency of labor. Yet we know prac- 
 tically nothing of the laws which govern the dis- 
 tribution of wealth. The university is silent on 
 the subject. It remains almost unexplored by the 
 political economist. The splendid foundations for 
 the promotion of scientific research neglect this, 
 the most important concern of man, for the study 
 of the earthworm and the oyster. 
 
 We have sadly inverted the importance of things. 
 It is of comparatively little advantage to society 
 that one man can produce a hundred pairs of shoes 
 where but a single pair was produced a generation 
 ago, if his labor still gives him but a single pair of 
 shoes. It is of small profit to humanity that the 
 annual production of wealth now amounts to 
 $1,170.20 per family, if an increasing percentage 
 
 185 
 
186 PRIVILEGE AND DEMOCRACY 
 
 of the population still receive but the barest neces- 
 sities of life. The many aids of the government 
 are an empty service to the farmer, no less than 
 to the consumer, if the improvements in agricult- 
 ure are all absorbed by the railways, the ware- 
 houses, and packing establishments, just as it is 
 an empty service to the wage-earner to be trained 
 to perfection in technical schools, if the result of 
 his training is all appropriated by another. 
 
 There must be an answer to the question of why 
 the few receive more than they can possibly earn, 
 while the millions receive less than they absolutely 
 need; why it is possible for an Astor, a Rockefeller, 
 a Carnegie, or a Morgan to pile up wealth which 
 runs into the hundreds of millions, while other 
 men of equal talent and industry produce no more 
 than a living, while millions never rise above the 
 fear of sickness, a period of industrial depression, 
 or some calamity which temporarily disables the 
 producing member of the family. 
 
 The explanation of this mystery has been sug- 
 gested in the preceding pages. Those who have 
 followed the tendencies there described have seen 
 emerging an explanation so obvious and so simple 
 that it should have become the commonplace of 
 political economy. We have seen how the Ameri- 
 can continent has been peopled by successive gen- 
 erations of pioneers spreading out from the At- 
 lantic seaboard in concentric circles to the West; 
 
THE DISTRIBUTION OF WEALTH 187 
 
 how decade by decade the outer Une of popula- 
 tion has moved steadily toward the Pacific Ocean, 
 leaving farms, towns, and industry in its rear. We 
 have seen how the free land has been all enclosed, 
 how tenancy has appeared along with land mo- 
 nopoly, how all of the resources of the nation have 
 been appropriated, and the highways have been 
 massed under the control of a constantly narrow- 
 ing syndicate able at will to fix the terms on which 
 the industrial life of the nation will circulate. 
 
 We have seen, too, how land began to have an 
 increasing value due to the pressure of population. 
 It was higher at the seaboard than it was in the 
 interior. It was more valuable in the towns than 
 it was in the country. Some of it is more pre- 
 cious than the silver dollars which will cover its 
 surface. Some of it may still be had for a song. 
 It ranges in value from the million-dollar lot in 
 the centre of a great city to the semi-arid wastes 
 which scarcely support life. Everywhere, however, 
 the value of the land reflects the density of popula- 
 tion, the improvements in the means of production, 
 and the necessities of the people. Everywhere the 
 value is social. It is not due to any service rendered 
 by the owner. 
 
 Some land still has no value. It will produce no 
 more than a living for him who works upon it. 
 This land is the "no rent" land, the land of 
 "marginal fertility." It produces no surplus, it 
 
188 PRIVILEGE AND DEMOCRACY 
 
 yields no rent. But while this land of "marginal 
 fertility" has no market value and yields no rent 
 itself, it fixes the value and rent of all other land. 
 For everything that other land, whether it be a city 
 site, a bonanza mine, a market garden, m a country 
 farm, produces in excess of the return from the land 
 of "margined fertility," the land which will just sup- 
 port the worker at the prevailing standard of living, is 
 rent ; it is the annuxil valve of the unearned incre- 
 ment which society has produced. 
 
 We have seen how the land of America is now 
 appropriated. It is constantly increasing in value. 
 And this value never recedes. The present popu- 
 lation, the number of children that are born, the 
 number of immigrants admitted to our shores, 
 this it is that determines the price which shall be 
 paid for the privilege of being upon the earth. 
 This measures the demand. It is daily and hourly, 
 by night as well as by day, increasing in intensity. 
 The supply of land, however, is constant. It is 
 fixed irrevocably. No effort of man can enlarge 
 it. The only element that is variable is the de- 
 mand. And the demand is indicated by the census 
 returns. 
 
 Rent is the resultant of the struggle. It may 
 be paid in personal services, in the shares of the 
 farm tenant, or in cash. It may be paid in mining 
 royalties or dividends, in the charges of the rail- 
 ways or franchise corporations. In a thousand 
 
THE DISTRIBUTION OF WEALTH 189 
 
 unseen forms rent is collected. It is a toll upon 
 every act of our lives. And rent, like land value, 
 is a social product. It is a common treasure. 
 Political economists have obscured the nature of 
 rent by phraseology. Ricardo defines rent as "that 
 portion of the produce of the earth which is paid 
 to the landlord for the use of the original and 
 indestructible powers of the soil."' John Stuart 
 Mill says: "The rent, therefore, which any land will 
 yield, is the excess of its produce, beyond what would 
 be returned to the same capital if employed on the 
 worst land in cultivation." ^ 
 
 All of the economists agree in this: rent has 
 nothing to do with the character, thrift, or intelli- 
 gence of the owner of the land. There is no service 
 rendered by him in return. The owner may live in 
 some distant corner of the earth, as do some members 
 of the Astor family. Rent is paid for the mere 
 privilege of living upon the earth, for the right of 
 using one's labor upon God's common heritage. 
 
 Some economists have seen further than this. 
 They have seen that rent is not a constant charge. 
 In all progressive communities it continually rises 
 in amount. In time men offer all that the land 
 will yield in excess of a mere living for the privi- 
 lege of its use. Necessity then fixes the tribute. 
 The love of life holds the scales in determining its 
 
 ' Principles of Political Economy and Taxation, chap. 2, p. 34. 
 'Principles of Political Economy, book II, chap. 3. 
 
190 PRIVILEGE AND DEMOCRACY 
 
 amount. This is what happened in Ireland. This 
 is what is taking place in Great Britain to-day. 
 This is the ultimate and the inevitable result of 
 the private ownership of the land. 
 
 This tendency was recognized by Ricardo, who 
 said: "The whole surplus product of the soil, after 
 deducting from it only such moderate profits as are 
 sufiicient to encourage accumulation, must finally 
 rest with the landlord. " ' 
 
 This fact was later emphasized by Professor 
 Cairnes, who wrote: "A given exertion of capital 
 and labor will now produce in a great many direc- 
 tions five, ten, or twenty times — in some instances, 
 perhaps, a hundred times — the result which an 
 equal exertion would have produced an hundred 
 years ago; yet the rate of wages has certainly not 
 advanced in anything like a corresponding degree, 
 whilst it may be doubted if the rate of profit has 
 advanced at all. Some one, no doubt, has bene- 
 fited by the enlarged power of man over material 
 nature; the world is, without question, the richer 
 for it. The large addition to the wealth of the coun- 
 try has gone neither to profit nor to wages nor yet to 
 the public at large, but to swell a fund ever growing, 
 even while its proprietors sleep — the rent-rolls of the 
 owners of the soil. " ^ John Stuart Mill expressed the 
 
 ' Principles of Political Economy, chap. 24, p. 202. 
 'Some Leading Questions of Political Economy Newly Expounded, 
 pp. 275-279. 
 
THE DISTRIBUTION OF WEALTH 191 
 
 same thought. "The ordinary progress of a so- 
 ciety," he says, "which increases in wealth is, at 
 all times, tending to augment the incomes of land- 
 lords; to give them both a greater amount and a 
 greater proportion of the wealth of a community, 
 independently of any trouble or outlay incurred by 
 themselves. They grow richer, as it were, in their 
 sleep, without working, risking, or economizing. 
 What claim have they on the general principle of 
 social justice to this accession of riches?" ' 
 
 I admit that it is impossible to demonstrate that 
 the wealth of the world is being appropriated by 
 those who own the land. Neither can the land 
 question be visualized as can the capitalistic sys- 
 tem. But a common knowledge is conclusive that 
 only the landed classes are conspicuously rich. 
 This is true in every country. An enumeration of 
 the millionaires in any city finds no retail and only 
 rarely a wholesale dealer among them. There are 
 comparatively few merchant princes. Here and 
 there a wealthy manufacturer may be found, but 
 his fortune is usually traceable to some patent 
 right, or the identity of his business with some 
 landed interest, tariff privilege, or railway rebate. 
 Competitive business produces few millionaires in 
 this or any other country. And they suffer con- 
 stant reverses. Their fortunes rarely outlive the 
 generation which inherits them. The conspicuous 
 
 ' Principles of Political Economy, book V, chap. 1. 
 
192 PRIVILEGE AND DEMOCRACY 
 
 ; wealth of America is landed. It springs from city 
 sites, from mines, railways, transportation, and 
 franchise holdings. It is social in its origin, not 
 competitive. It is permanent and increases more 
 rapidly than the powers of spendthrift children to 
 dissipate it. Take the long list of millionaires of the 
 blue-book of Wall Street or of any great city; almost 
 without exception their fortunes are the creation 
 of society. They are identified with some landed 
 privilege. They represent no labor of their owners. 
 And they are all identified with the land. From 
 out the coal and the oil, the natural-gas and the 
 copper, the gold and the silver mines scores of 
 other fortunes have been created, fortunes which are 
 increasing in value with each passing year through 
 the necessities of humanity. 
 
 Great Britain is a conspicuous example of the 
 same fact. Her aristocracy is a landed one. Trade 
 and commerce have enriched the country, but there, 
 as here, the increase in wealth has largely passed 
 to those, who own the land. 
 
 And in that country the process of social pro- 
 duction and private appropriation has reached its 
 logical conclusion. The peasant and the artisan 
 are miserably poor, while industry itself is being 
 gradually impoverished by the very poverty of the 
 producing classes. They cannot buy what capital 
 produces. They are so poor that they cannot con- 
 sume. Everything above the minimum of exist- 
 
THE DISTRIBUTION OF WEALTH 193 
 
 ence is taken in rent. This is what is the matter 
 with Great Britain. The land is held in vast ma- 
 norial estates. Millions of acres are kept out of use 
 for hunting preserves and parks. Even greater 
 areas are used for grazing and careless agriculture. 
 And that which is open to occupancy is subjected 
 to the competition of forty millions of workers, who 
 produce scarcely enough to ward off eviction. After 
 the rent is paid there is little left with which to 
 buy other things. Thus rent starves not only the 
 workers, it starves capital as well. For industry 
 must have a market. It can only flourish where 
 the mass of the people are able to consume. And 
 in Great Britain the mass of the people are con- 
 tinually at the starvation point. 
 
 The real struggle over the distribution of wealth 
 is between the landlord on the one hand, and capi- 
 tal and labor on the other. Rent fixes interest and 
 profits just as it fixes wages. All of the wealth 
 that is produced is divided between the landlord, 
 the capitalist, and the wage-earner. These are 
 the only possible claimants among whom it can be 
 distributed. Disagreement arises as to who re- 
 ceives the lion's share. We have seen that the 
 share of the land-owner is constantly increasing by 
 the growth in the value of the land. We have 
 further seen that the great fortunes of America, as 
 well as of England, are landed fortunes. It is not 
 the capitalist who is the offender. The returns of 
 
194 PRIVILEGE AND DEMOCRACY 
 
 capital in the form of profits and interest tend 
 always to an equality. They are automatically 
 governed by the average returns in the community, 
 and that return is somewhere in the neighborhood 
 of six per cent. If the profits of a given industry 
 rise above the average, new capital flows into the 
 industry until competition reduces returns to that 
 level. A conspicuous example of that fact is af- 
 forded by the manufacture of automobiles. The 
 industry is scarcely ten years old. There are few 
 privileges connected with the business. It requires 
 an immense outlay of capital. Yet it is doubtful 
 if the returns on the industry taken as a whole have 
 equalled the current return on mortgages. In the 
 long-run profits and interest are fixed by this proc- 
 ess. The returns of capital are kept at a com- 
 petitive minimum by the operation of the law of 
 supply and demand. 
 
 There would be no dispute about this tendency 
 were it not for the fact that capital is so often con- 
 fused with some form of land monopoly. This is 
 true of mining, it is true of the railways and trans- 
 portation business, it is true of the franchise cor- 
 porations which occupy our streets. It is also true 
 of many other industries which are so identified 
 with the land, with railway rebates, with the tar- 
 iff, with patent rights, as to be free from the com- 
 petition of capital with capital. But if we exclude 
 such industries we shall see that the capitalist is not 
 
THE DISTRIBUTION OF WEALTH 195 
 
 the offending party in the distribution of wealth. 
 He suffers along with the worker. 
 
 We see conclusive evidence of this fact in new 
 countries where land values have not begun to 
 appear. Here wages and interest are high, while 
 rent is low. So long as the wage-earner can turn 
 his hand to fertile fields of his own, the wages of 
 all industry will respond to this alternative. The 
 worker will not labor for another for less than he 
 can produce himself. It is this and not the tariff 
 that has determined the rate of wages in America. 
 Adam Smith recognized the effect of cheap land on 
 wages. In discussing the "Causes of the Prosperity 
 of New Colonies," he says: "Every colonist gets 
 more land than he can possibly cultivate. He 
 has no rent and scarce any taxes to pay. He is 
 eager, therefore, to collect laborers from all quar- 
 ters and to reward them with the most liberal wages. 
 But those liberal wages, joined to the plenty and 
 cheapness of land, soon make those laborers leave 
 him in order to become landlords themselves, and 
 to reward with equal liberality other laborers who 
 soon leave them for the same reason that they left 
 their first master. " * 
 
 The American West has demonstrated this theory. 
 Up to but yesterday in Oklahoma, in Dakota, in 
 the mining regions of Nevada, Colorado, and Alaska, 
 wages were high, and still the labor market was un- 
 
 ' Wealth 0} Nations, book 4, chap. 7. 
 
196 PRIVILEGE AND DEMOCRACY 
 
 satisfied. Interest, too, ranged from eight to twelve 
 per cent. Workmen could only be had on their 
 own terms. They could scarcely be obtained at all. 
 For there were homesteads or mining claims to be 
 staked out at an insignificant cost. Land was 
 cheap. It was accessible to all. Everything that 
 it produced went back to the worker. Here we 
 find men owning their own homes. They enjoy a 
 freedom that is not to be found in the East. But 
 what will be the condition a generation hence? By 
 that time Eastern conditions will have appeared in 
 the West. Machines will do the work formerly 
 done by hand. There will be rapid transportation 
 and communication. There will be a far greater 
 production of wealth, it is true. The per capita 
 wealth will be doubled, possibly quadrupled. There 
 will be schools and universities, churches and libra- 
 ries. All of the evidences of culture and refine- 
 ment will have appeared. But who will have 
 benefited by the change? Will wages have ad- 
 vanced? Will interest rates be higher? Not if 
 the experience of older communities offers any 
 proof. Instead of every man being a home-owner, 
 a tenant class will have appeared. In the centre 
 of every county there will be a jail. There will be 
 almshouses and asylums. In the cities there will 
 be a residuum of wreckage, of vagabonds, and the 
 semi-criminal class, which, by some mysterious 
 process, has been cast upon the shores of society 
 
THE DISTRIBUTION OF WEALTH 197 
 
 by the very advance in civilization which should 
 have rendered involuntary poverty out of the ques- 
 tion. The slum will come in with the mansion; 
 the prison with the priest. Where once there was 
 equality, now there is inequality; where once there 
 was freedom, now there is servitude. The pro- 
 duction of wealth will have increased even more 
 rapidly than the production of men. In spite of 
 this, where once there was more than enough for all, 
 now there is only enough for a few, and hunger 
 and want and privation for the destitute many. 
 While the returns on capital have fallen, while 
 wages have been reduced or at most remained sta- 
 tionary, one class, and one alone, will have been 
 benefited by the change. The value of land will 
 have increased with each passing day. Those who 
 own the land are better for the change. Their in- 
 comes will have increased possibly a hundred-fold. 
 On the other hand all other classes will be the poorer 
 because of the wealth which they have created. 
 
 That rent is constantly rising, that it is higher 
 to-day than it was yesterday, that it will be higher 
 to-morrow than it is to-day, all will agree. But 
 why, it may be asked, is this inconsistent with an 
 equally rapid increase in wages ? Why may not the 
 returns of labor increase even more rapidly than 
 the returns of the landlord, and the condition of the 
 wage-earner in reality grow better ? Why, in fine, 
 does increasing rent preclude increasing well-being ? 
 
198 PRIVILEGE AND DEMOCRACY 
 
 The growth of population and the speculative 
 ownership of the land make this impossible. A 
 glance into the future proves it to be true. Fifty 
 years hence there will be two hundred millions of 
 people in America. They will increase the value 
 of the land, just as they have increased the value 
 of the land underlying New York, which now ex- 
 ceeds three and one-half billion dollars. The value 
 of the land will be more than doubled, it will prob- 
 ably be quadrupled. It is even now increasing in 
 value at the rate of from one to two billion dollars 
 a year. Land will have acquired a famine price 
 long before another generation has elapsed. And 
 rent will increase far more rapidly than population. 
 For land speculation is intensified by scarcity. In- 
 creased exertion, improved machinery, every con- 
 tribution of the arts and sciences, will but increase 
 the value of the land and the tribute which the 
 owner will demand for its use. 
 
 And while rent will increase, the incomes of all 
 other classes must fall. More rent will be demanded 
 from the tenant farmer and the city dweller. At 
 the same time the relative amount of land in use 
 will be diminished. Per capita production will, in 
 many lines, fall. Opportunities will be lessened, 
 while the cost of all commodities will be increased. 
 There will be fewer jobs to go around, and an in- 
 creased cost of living to all classes. From this 
 condition there is no escape. To this indictment 
 
THE DISTRIBUTION OF WEALTH 199 
 
 there is no confession and avoidance. We cannot 
 limit the supply or increase the demand for any 
 commodity without increasing its price, and we 
 are both limiting the supply and increasing the de- 
 mand for land. 
 
 Herein is the real iron law of wages. It applies 
 to capital no less than to labor. It is the ten- 
 dency of all wages to fall to the amount which will 
 just support the worker and enable him to repro- 
 duce his kind. This is not a very generous law. 
 but neither is the law of the survival of the fittest. 
 But so long as land is an object of private prop- 
 erty it is a law, nevertheless. And from now on 
 the tendencies at work will lead to a constant and 
 rapid lowering of the standard of living in America. 
 There will be a gradual reduction in the scale 
 of expenditure of all classes; a limitation in the 
 outgo for education, for pleasure, for the comforts 
 of life. The effect of this change will not be con- 
 fined to the wage-earning dr professional classes. 
 It will affect industry as well. For the manufactu- 
 rer is dependent upon the prosperity of the wage- 
 earner. Industry cannot flourish where wages are 
 low. Were the wages of America doubled, the coun- 
 try would enjoy a period of prosperity such as we 
 have never experienced. Then men would be able 
 to purchase twice as much as they do to-day. And 
 just as an increase in wages brings prosperity, so a 
 general reduction of wages by consumption taxes 
 
200 PRIVILEGE AND DEMOCRACY 
 
 and rent checks prosperity. And in time rent will 
 increase to such a point as to bring about perma- 
 nent industrial depression. In time it will produce 
 national decay. 
 
 This is a question upon which the industrial life 
 of the nation depends. It is idle to look for any 
 improvement in the well-being of humanity so long 
 as the private ownership of the land prevails. The 
 adoption of sumptuary legislation, the erection of 
 model tenements or garden cities, the municipali- 
 zation of franchise corporations, even the organi- 
 zation of labor unions and the abolition of unjust 
 taxes, these reforms may bring temporary or local 
 relief. But so long as the private ownership of the 
 land remains, wages and interest must tend to fall 
 to the subsistence level, to the point where the wage- 
 earner can only sustain life. 
 
 Unfortunately even this cheerless comfort is not 
 left to those who look upon this as the best of all 
 possible worlds. For population pays no attention 
 to the laws of political economy. The birth rate 
 increases without thought of the checks and re- 
 straints which the economists of the early half of the 
 last century sought to have the laboring class impose 
 upon themselves. And when the land is all taken 
 up, when even the marginal land is under cultiva- 
 tion, humanity will still continue to crowd in upon 
 the earth and clamor for its chance to live. Then 
 the value of labor, like the value of any other com- 
 
THE DISTRIBUTION OF WEALTH 201 
 
 modity produced in excess of the current demand, 
 will fall to zero. Then an increasing residuum 
 will not even receive a subsistence wage. Then 
 the monopoly of the land will bring famine. For 
 famine can exist in the midst of plenty; it can 
 exist where civilization has flowered to its highest. 
 
CHAPTER XVII 
 THE ASCENDANCY OF PRIVILEGE 
 
 Humanity, as we have seen, has bound itself, 
 as the Lilliputians bound Gulliver, with a thousand 
 thongs. It is fettered by its own institutions; it is 
 bound by its own laws. Freedom is progressively 
 reduced by privilege and monopoly in every depart- 
 ment of life. Again, as under the ancient regime, 
 society is enmeshed with class-made laws, which 
 interfere, at every turn, with the production, dis- 
 tribution, and exchange of wealth. 
 
 In the opening paragraph of Protection and 
 Free Trade Henry George has symbolized the 
 condition of modern society in the following words: 
 "Near the window by which I write a great bull is 
 tethered by the nose. Grazing round and round 
 he has wound his rope about the stake until now 
 he stands a close prisoner, tantalized by rich grass 
 he cannot reach, unable even to toss his head to 
 rid him of the flies that cluster on his shoulders. 
 Now and again he struggles vainly, and, after piti- 
 ful bellowings, relapses into silent misery. 
 
 "This bull, a very type of massive strength, who, 
 because he has not wit enough to see how he might 
 
 202 
 
THE ASCENDANCY OF PRIVILEGE 203 
 
 be free, suffers want in sight of plenty, and is help- 
 lessly preyed upon by weaker creatures, seems to 
 me no unfair emblem of the working classes. " 
 
 We are the architects of our own misfortunes. 
 We have created the millionaire along with the pau- 
 per, the palace along with the slum, by laws in- 
 scribed on the statute books at Washington, in the 
 capitals of our states, and in the council chambers 
 of our cities. It is through legislation that America 
 has been divided into classes, the class which pro- 
 duces the wealth of the world and the class which 
 appropriates it. For classes have arisen in this 
 country, however much we may seek to disguise 
 it. But the line of division is not between the capi- 
 talist and the wage-earner; it is between those who 
 are encamped within and those who are encamped 
 without the citadel of laws which the ascendant 
 class has erected for its own advantage. For the 
 control of the government has been in the hands of 
 an economic class almost continuously from the 
 very beginning. 
 
 The struggle to control the government made 
 its appearance with the birth of the nation. The 
 protective tariff, the excise laws, the national bank 
 act, these, together with the assumption of the 
 debts of the states, as proposed by Hamilton, were 
 inspired by the interests of the commercial classes 
 of the seaboard, who saw in the new government 
 a means for promoting their interests. 
 
204 PRIVILEGE AND DEMOCRACY 
 
 Hamilton was the protagonist of these classes, 
 just as he had been in the Constitutional Conven- 
 tion. He laid the foundations on which privilege 
 has ever since reared itself. In devising a revenue 
 system he adopted the models which the landed 
 aristocracy of England had evolved to shift the 
 burdens of government onto the poor. This, too, 
 was a heritage of feudalism. It came to us along 
 with the common law and our ideas of private 
 ownership of the land. And the models which 
 Hamilton used were the result of a conspiracy en- 
 tered into between Charles II and the land-owners 
 in Parliament in 1692. Prior to that time the needs 
 of the crown had been largely supplied by feudal 
 dues paid by the great land-owners, just as dues 
 and services were paid to them by their dependants. 
 It was over these grants to the crown that most 
 of the great constitutional struggles of England 
 took place. By an arrangement entered into in 
 the close of the seventeenth century, however, these 
 controversies were brought to an end. The barons 
 agreed that their lands should bear taxes to the 
 extent of two millions of pounds, at which point 
 their taxes were later irrevocably fixed. In addi- 
 tion to this the crown was to receive certain in- 
 direct taxes on consumption which were largely 
 paid by the poor. By this arrangement the com- 
 mon people were made to bear the bulk of the 
 taxes, while the barons were relieved of their feudal 
 
THE ASCENDANCY OF PRIVILEGE 205 
 
 dues. In so far as the barons are concerned this 
 compact has never been disturbed. Their lands 
 have never been revalued from that day to this. 
 Their land taxes still remain as fixed at that time. 
 But the indirect excise and customs duties paid 
 by the poor have increased until to-day they 
 amount to $300,000,000 a year. By this arrange- 
 ment the king was assured a source of income which 
 could not arouse resistance, a source of revenue 
 which has ever since been used by privilege. Since 
 that time there has been no serious conflict be- 
 tween king and Parliament. The control of the 
 purse-strings has passed to the territorial aris- 
 tocracy. There is no taxation by representation 
 in England even to-day, and it is the attempt to 
 establish that fact that precipitated the budget 
 fight of 1909. Great Britain is taxed by an eco- 
 nomic class, a class which has exempted its lands 
 and privileges from taxation just as it has in 
 America, 
 
 This was the system that Hamilton took as a 
 model. It has remained the basis of all subsequent 
 legislation. Under the first revenue measure of 
 Congress wealth as wealth was entirely relieved of 
 taxation. A national bank was provided for which 
 served the interests of the Eastern trading classes, 
 just as does the banking system to-day. It con- 
 centrated the available credit of the country in the 
 East. 
 
206 PRIVILEGE AND DEMOCRACY 
 
 From the election of Jefferson down to the Civil 
 War the government was in the hands of the Dem- 
 ocratic party. The functions of the Federal Gov- 
 ernment were limited, the tariff was reduced to a 
 revenue basis, and the government was tolerably 
 free from the control of the commercial classes. 
 The controversies over the tariff were a rancorous 
 issue in Congress, as were the repeated efforts to re- 
 establish the United States Bank. At no time, 
 however, did the business interests control the 
 government as they had under the Federalist party. 
 They were held in check by the South and the West. 
 
 During the generation which preceded the Civil 
 War a new alignment of interests arose. On the 
 one hand were the manufacturing and trading 
 classes of the seaboard. On the other hand were 
 the cotton-planters and slave-owners of the South. 
 Both sought to control the government, and both 
 were animated by the same motive. The former 
 desired a protective tariff, designed to give them 
 a monopoly of the home market. But protection 
 was a menace to the South, interested as it was in 
 the production of cotton, tobacco, and sugar, and 
 desirous of the freest possible trade with the out- 
 side world. Between these two economic classes 
 there was no possibility of compromise. And the 
 South was supreme in the councils of the nation. 
 The slave-owning classes controlled the Presidency, 
 Congress, and even the Federal judiciary. The 
 
THE ASCENDANCY OF PRIVILEGE 207 
 
 patriotism of the South reflected the interest of its 
 ascendant class. Men rallied to the call of South 
 Carolina, Virginia, and Mississippi for the preserva- 
 tion of an economic system, rather than for any 
 ideal of state sovereignty. And the commercial 
 classes of the North were inspired by no higher 
 ideals. They were, primarily, interested in the 
 tariff. They desired to share with the cotton-plant- 
 ers the privileges which only the Federal Govern- 
 ment could bestow. 
 
 To the trading classes of the East the Civil War 
 was opportune. The representatives of the slave 
 states retired from Congress. There was now no 
 economic class sufficiently cohesive to withstand 
 the aggressions of the manufacturers. At the same 
 time the cost of the war left the nation an easy 
 prey to the demands for protection. The needs 
 of the Treasury were insatiate. Unparalleled reve- 
 nues had to be raised. The manner of their collec- 
 tion could not be too closely scrutinized. The 
 maintenance of the Union was of paramount im- 
 portance. On the convening of Congress in 1861 
 the tariff was raised in an unexpected way. From 
 this time on the number of protected articles, as 
 well as the rates of duties, was constantly increased. 
 Scarcely a month of any session passed without 
 some change being made. The tariff acts of 1862, 
 1864, and 1865 violated every tradition of the 
 country, and every expectation of those who had 
 
208 PRIVILEGE AND DEMOCRACY 
 
 supported the Republican party. The necessities 
 of the war engrafted the poHcy of protection so 
 completely upon us that neither of the great po- 
 litical parties has since been able to effect its re- 
 duction. 
 
 An elaborate internal revenue system was added. 
 Every conceivable commodity manufactured within 
 the country was taxed, as was every accessible 
 transaction. The excise was designed, as David 
 A. Wells has said, on the principle of the Irishman 
 at Donny brook Fair: "Whenever you see a head, 
 hit it; whenever you see a commodity, tax it." 
 Many articles were taxed over and over again 
 before they reached the consumer. The duty on 
 distilled spirits was increased until it amounted to 
 a thousand per cent, on its cost. Taxes on cigars 
 and tobacco were repeatedly raised until revenue 
 evasion became a most profitable employment. 
 The high duties were responsible for all sorts of tax 
 frauds. The corruption of the Whiskey Ring, 
 which culminated in the disclosures of Grant's second 
 administration, grew out of the excise system. 
 
 Along with the bargaining over the tariff, the 
 excise system, and tax evasions went fraudulent 
 army contracts, collusion of officials and specula- 
 tors, and all of the corrupting influences which fol- 
 low in the trail of a great war. Privileges of every 
 sort forced an entrance into Congress, too much 
 engrossed with saving the Union to scrutinize 
 
THE ASCENDANCY OF PRIVILEGE 209 
 
 the details of legislation or administration. In 
 these days of sacrifice on the part of the people, 
 the foundations of many princely fortunes were 
 laid, while private interests intrenched them- 
 selves in every department of the government. 
 
 Diu-ing these years of suffering on the part of 
 the people, Wall Street identified itself with Wash- 
 ington. Under the administration of Secretary 
 Chase the Treasury carried through its borrow- 
 ing operations with the aid of the New York banks. 
 Billions of securities were sold at home and abroad. 
 An intimacy was thus established which has con- 
 tinued ever since. With but slight and occasional 
 interruptions, the Treasury portfolio has been in- 
 trusted to bankers whose instincts and interests 
 have led them unconsciously to identify the wel- 
 fare of the country with the business in which they 
 are engaged. The National Bank Act united the 
 government still more closely with the financial 
 interests. These, together with the complex mone- 
 tary system which has been created, have woven 
 the operations of the Treasury Department into a 
 close dependence upon the big financial institutions 
 of the country. 
 
 Upon the termination of the war all moderation 
 was thrown to the winds. Instead of being reduced, 
 tariff schedules were increased to suit whoever 
 wanted protection. Oppressive tax measures were 
 fastened upon the people with every show of pa- 
 
210 PRIVILEGE AND DEMOCRACY 
 
 triotism. The revenue measures were framed by 
 the big business interests. Wealth was absolutely 
 freed from taxation. This was done with such an 
 assumption of patriotism that the fearful injustice 
 of it all has been concealed. Yet it is doubtful if 
 hereditary privilege in any country in Europe has 
 been more unscrupulous in the use of its power, 
 or gone further in exempting itself from taxation, 
 than have the privileged interests in control of 
 Congress. The entire burden of taxation has been 
 thrown upon consumption. No attempt has been 
 made to reach wealth in any form. 
 
 During the decade which closed with 1870 the 
 railways were invited to the feast. They took 
 what they wanted of the public land. In less 
 than a decade the Pacific railways alone secured 
 more than 100,000,000 acres of the public domain 
 as an aid to their construction. These magnifi- 
 cent grants, whose combined area equals that of 
 Maine, New Hampshire, Vermont, Massachusetts, 
 Rhode Island, Connecticut, New York, New Jersey, 
 and Pennsylvania, were supplemented by a loan 
 from Congress of $60,000,000 more. The consid- 
 eration for these subsidies was the construction 
 of the Pacific railways a few years in advance of 
 the natural development of the West. 
 
 Along with the railways were corporations, in- 
 dividuals, and syndicates which appropriated forests 
 and mineral resources, whose value is so great as to be 
 
THE ASCENDANCY OF PRIVILEGE 211 
 
 merely a matter of conjecture. Members of Congress 
 saw no wrong in conveying to themselves, or to cor- 
 porations in which they were interested, the richest 
 lands of the West. 
 
 The Credit Mobilier grew out of the railway-aid 
 mania. This was a corporation with a French 
 name organized as a construction company for the 
 Union Pacific Railway. Its stockholders were the 
 same as those of the railway, which had secured 
 valuable land grants from Congress. The scandals 
 growing out of the ownership of its stock by public 
 officials involved the Vice-President, the Secretary 
 of the Treasury, the Speaker of the House of Rep- 
 resentatives, and many Congressmen who were 
 believed to have been influenced to vote for leg- 
 islation favorable to the railroad by virtue of the 
 stock which they held in the company. 
 
 Thus the necessities of the Civil War commer- 
 cialized the government. So absorbed was the 
 public in a struggle for self-preservation, that priv- 
 ilege gained an easy entrance into our politics. 
 The slave-owning oligarchy had been content with 
 the status quo. It was on the defensive. In the , 
 years which followed the war, however, privilege | 
 became arrogant. It came to believe that business 1 
 is the sole end of the government. The exhaustion J 
 of the struggle left the people an easy prey to 
 such a philosophy, a philosophy from which they 
 are just beginning to be aroused. 
 
212 PRIVILEGE AND DEMOCRACY 
 
 Following the close of the war, a revenue com- 
 mission was appointed to devise means for the re- 
 form of the revenues. An immediate reduction of 
 the tariff and internal taxes was recommended. 
 But Congress refused to reduce the tariff, although 
 an immediate abatement in the excise duties was 
 ordered. For the purpose of endearing the tariff 
 to the wage-earner, a deadly parallel was drawn 
 to show the impoverished condition of labor under 
 free trade in England. Since that time the pro- 
 tection of American labor has been the wall behind 
 which the trusts have sheltered themselves. In 
 each successive campaign this argument has been 
 paraded to the exclusion of all other matters of 
 national concern. Finally, after years of agita- 
 tion, Mr. Cleveland was elected President in 1892, 
 on the platform of tariff reform. For the first time 
 since the war both houses of Congress, as well as 
 the Presidency, were in the hands of the Demo- 
 cratic party, and the programme of tariff revision to 
 which the party was pledged was ready for enact- 
 ment. But what was the outcome? We had sown 
 the wind; we were to reap the whirlwind. One 
 of the costs of protection appeared in the Wilson- 
 Gorman Bill, which was finally presented to the 
 country. This measure purported to reduce the 
 tariff, and in many instances did so, but so little 
 disguised was the policy of protection in it, and 
 so shamelessly had "tariff reform" been aban- 
 
THE ASCENDANCY OF PRIVILEGE 213 
 
 doned that the country repudiated the measure. 
 The contest before the people had been an honest 
 one. In Congress it was not one of principle, not 
 one of the country's well-being. It was a struggle 
 of warring interests which openly bought pro- 
 tection or secured control of the party in power. 
 At the next election the Democratic party was 
 defeated and discredited. It has never regained 
 the confidence of the people. 
 
 During the intervening years politics and privi- 
 lege have been merged. The Federal Government 
 has passed into the hands of an ascendant 
 economic class. The brain of this merger is in 
 Wall Street. From this nerve centre the outer- 
 most extremities of our social and political life 
 are controlled. In this merger the railway in- 
 terests predominate. For they are concerned with 
 state as well as Federal legislation. They are 
 perfectly catholic in their politics and identify 
 themselves with the Republican party in a Repub- 
 lican state and the Democratic party in a Dem- 
 ocratic state. In most instances the railways 
 control or constantly seek to control both parties. 
 Here and there the railway interests are subordi- 
 nate to those of the mine-owner, the franchise cor- 
 poration, or the land and timber interests of the 
 West. These great interests, with their capitaliza- 
 tion of from twenty-five to forty billions of dollars, 
 are concentrated in Wall Street. They respond 
 
214 PRIVILEGE AND DEMOCRACY 
 
 sympathetically to any action which threatens 
 their political control or imperils their privileges. 
 
 These interests ramify back and forth jnto one 
 another much as the crowned heads of Europe are 
 united by marriage connections. They have com- 
 mon boards of directors. They are united by a 
 class-conscious instinct, and are in perfect harmony 
 as to their interests. 
 
 In every city may be found a group of lesser 
 feudal barons. They own the minor privileges. 
 Their instincts are the same as those of Wall Street. 
 They control the local press and the agencies of 
 public opinion. They corrupt the governments of 
 city and state. Between them and the great mass 
 of the people there is a natural line of cleavage. 
 On the one hand are those who control the gov- 
 ernment in their own interest. On the other hand 
 are those who do not. 
 
 It is by this process that the politics of America 
 have passed into the hands of an economic class. 
 Again, as in ante-bellum days, privilege is ascend- 
 ant. The class which rules is small in numbers, 
 but powerful in influence, as any one learns who 
 dares to touch the least of its preserves. 
 
 How costly this merger of politics and privilege 
 is to the people and the ideals of democracy will 
 be shown in the next chapter. 
 
CHAPTER XVIII 
 AN OVERLOOKED CAUSE OF POVERTY 
 
 "Laws," says Rousseau, "are always useful to 
 those who own, and injurious to those who do not. " 
 A discerning political philosopher of the eighteenth 
 century has said: "A man does not possess a de- 
 mesne because he is a prince, but he is a prince 
 because he possesses a demesne." This is but 
 another way of saying that whoever owns a nation 
 rules it, and whoever rules a nation will come in 
 time to own it as well. 
 
 It is not dishonesty so much as the myriad in- 
 fluences which mould men's minds that makes this 
 true. A government of bankers honestly believes 
 that the welfare of the nation is bound up in the 
 welfare of the banking interests; a government 
 of manufacturers honestly believes that the pros- 
 perity of the country is determined by the pros- 
 perity of its class; a government of railway-owners 
 measures national well-being by railway earnings; 
 while mine-owners, landlords, brewers, distillers, 
 saloon-keepers, peasants, workers, — every class, in 
 fact, seeks to mould the government to its own; 
 particular interest. This is the economic interpreta-i 
 tion of politics. 
 
 215 
 
216 PRIVILEGE AND DEMOCRACY 
 
 And the ascendant class in America is a law- 
 made class. It is not predominantly a landed class 
 as it is in Great Britain and Russia. Neither is 
 it a capitalist class as the socialist asserts. It is 
 a privileged class. It includes, first, the railways 
 and the transportation agencies; second, the pro- 
 tected industries, and third, the franchise and other 
 public service corporations. The combined capi- 
 talization of these industries is not far from twenty- 
 five billion dollars. This is more than one-fifth 
 of the total estimated wealth of America. From 
 one-half to two-thirds of this capitalization is the 
 direct creation of law. It arises from exclusive 
 grants, like city franchises, monopoly privileges 
 made possible by the tariff, exemptions from taxa- 
 tion obtained through a control of the government 
 or the right to employ some other exclusive or 
 sovereign power. And it is to secure, protect, and 
 retain these monopoly privileges, to collect tribute 
 by means of them, and to capitalize that tribute 
 in watered securities that these interests are lured 
 into politics. It is this that has woven them into 
 the life of the nation. 
 
 An examination of the blue-book of American 
 millionaires will disclose that, almost without ex- 
 ception, the colossal fortunes which have come 
 into existence in recent years are the creation of 
 law. They have not been created by law-breakers. 
 They have been created by law-makers. They have 
 
AN OVERLOOKED CAUSE OF POVERTY 217 
 
 not been acquired dishonestly through corruption 
 alone; nor have they been acquired honestly through 
 ignorance alone. Ignorance and design, honesty 
 and dishonesty, have alike contributed to their 
 creation. The proximate cause is the control of 
 our politics by an economic class. 
 
 Let us trace some of the costs of this class con- 
 trol. It is most apparent in taxation. This is 
 ever the favorite tool of the privileged orders. The 
 total Federal revenues for the fiscal year 1908 
 amounted to $601,126,118. This does not include 
 the postal receipts. Of this sum $286,113,130 
 was collected from customs duties, and $251,711,126 
 from the excise or internal revenue taxes on dis- 
 tilled and malt liquors, tobacco, and oleomarga- 
 rine. $537,824,256 was thus collected by indirect 
 taxes upon consumption. The tax on sugar yielded 
 $50,118,141; wool and cotton manufactures yielded 
 $63,445,017 more; while leather, hides, wearing ap- 
 parel, china-ware, flax, hemp, and yarn products, 
 iron and steel, fruit and drugs, glass ware, chemi- 
 cals, wines, spirits, and tobacco yielded the greater 
 part of the balance. We have taxed almost every 
 necessity of life. The great bulk of the revenue 
 comes from those articles which the poor consume. 
 But an insignificant fraction is collected from the 
 luxuries of the well-to-do classes. And not a dol- 
 lar is taken from wealth, incomes, or inheritances 
 direct. 
 
218 PRIVILEGE AND DEMOCRACY 
 
 It is the poor of America who support the Fed- 
 eral Government. It is they who pay for the 
 battle-ships and the pensions, the internal improve- 
 ments and the coast defences. Not one penny 
 comes directly from the interests which are mainly 
 benefited by these expenditures. 
 
 But the burdens of indirect taxation do not end 
 with the taxes collected. This is the least of the 
 cost. The protective tariff is not primarily for 
 revenue purposes. It is designed in the interest 
 of a privileged class. Sheltered behind the tariff 
 wall, the sugar, meat, steel, coal, iron, leather, 
 wool, copper, oil, and other combinations exact 
 monopoly prices from the consumer of America. 
 The amount of the tribute which is thus collected 
 cannot be accurately known. There are over 2,000 
 articles on the tariff schedule. It has been esti- 
 mated that the monopoly prices exacted through 
 the duty on sugar alone amount to from $140,000,- 
 000 to $165,000,000 a year. Prof. W. G. Sumner 
 of Yale University estimated that the tariff in- 
 creased prices all around from thirty to forty per 
 cent. The average ad valorem rate is 42.92 per 
 cent. The tribute which the protected interests 
 exact is not far from $1,500,000,000.' 
 
 'The Tariff Reform Committee of the New York Reform Club, 
 estimating the real cost of protection in its effect upon prices, says: 
 "The total price of manufactured goods sold to final consumers in 
 this country can hardly be less than $6,000,000,000 and may be as 
 high as $8,000,000,000. If, as is reasonable and probable, their 
 
AN OVERLOOKED CAUSE OF POVERTY 219 
 
 Including the revenues actually collected from 
 indirect taxes, every man, woman, and child is 
 robbed of approximately twenty dollars a year for 
 the advantage of the tariff interests. Of this three 
 and one-half dollars reaches the treasury. The 
 balance is monopoly cost. Every family of five 
 pays tribute to the extent of $100 per annum to 
 the class which rules. The average income of the 
 working-classes in America is below $450 a year. 
 The census figures place the average wage at 
 $432.40.* Even this is probably an overestimate 
 when we consider the large percentage who are 
 constantly out of work, and the increasing number 
 of woman and child laborers whose incomes are 
 very much below this figure. But these are the 
 classes who maintain the government. It is they 
 who consume the great bulk of the imports as well 
 as the products of the protected industries. Out 
 of their meagre earnings the government filches 
 from one-fifth to one-fourth by indirect taxes and 
 the monopoly prices which the tariff makes possible. 
 
 (the protected) goods are worth twenty per cent, more in the home 
 market than they would . . . command in our markets were there 
 no tariff-protected trusts and monopolies in control here, then we are 
 paying something more than $1,000,000,000 for our tariff whistle. 
 This is the cost at wholesale prices. At retail prices the cost of 
 •protection* is probably $1,500,000,000, or $1,600,000,000. This is 
 about $90.00 per family for our entire population. " 
 
 'The census for 1900 gives the total average number of wage- 
 earners in the United States as 5,373,108 and the total wages paid 
 as $2,324,453,993. The average wage for the country was therefore 
 $432.40 for the year.— United States Census, Vol. VII, p. xlviii. 
 
220 PRIVILEGE AND DEMOCRACY 
 
 We hear but little of this burden. The con- 
 sumer cannot trace his falling standard of living 
 to its source. There is no paid lobby, no press, no 
 spokesman for those who only toil. Now and then 
 there comes a protest against this inequity. "The 
 tariff has built up an aristocracy already quite as 
 numerous as were the refractory slave-owners in 
 the South," says the Hon. John Bigelow of New 
 York. "It has built it up, too, by privileges quite 
 as unjust and as exclusively for money's worth, 
 but a thousand times more lucrative to its benefi- 
 ciaries than slavery ever was. The consequences 
 are that it has divided our people into two classes 
 — one, of the people who have more wealth than they 
 know what to do with or how to give away, and 
 another, of bread-winners, who, if they lose a day's 
 wages, even by illness, have to go in debt for their 
 next day's expenses. The increased cost of living 
 compels an increase in wages from time to time, 
 but always the cost of living increases faster, until 
 now the food of the proletariat has reached famine 
 prices in most of our large cities and is daily in- 
 creasing. With food enough produced in the United 
 States to nourish twice its population, the average 
 wage earner can lay up nothing, can provide few 
 privileges for his family and practically no recrea- 
 tion." • 
 
 1 Extract from published letter from Hon. John Bigelow to Gov- 
 ernor Hughes of New York, November 25, 1908. 
 
AN OVERLOOKED CAUSE OF POVERTY 221 
 
 In a letter to the Committee of Ways and Means, 
 hearing evidence upon the present tariff in No- 
 vember, 1907, Mr. Charles Francis Adams of Boston 
 said: "Speaking after the manner of men, they 
 [the protected interests] are either thieves or hogs. 
 I myself belong to the former class. I am a tariff 
 thief, and as such I have a license to steal. It 
 bears the broad seal of the United States, and is 
 what is known as the 'Dingley Tariff.' I stole 
 under it yesterday; I am stealing under it to-day; 
 I propose to steal under it to-morrow. But, on the 
 other hand, I am also a radical tariff reformer. I 
 would like to see every protective schedule swept 
 out of existence. " 
 
 Not only does the protective tariff impoverish 
 the people and promote corruption, it encourages 
 extravagance as well. The carnival of expendi- 
 ture, to which we became accustomed during the 
 Civil War, and which has continued ever since, is 
 directly traceable to the system of indirect taxa- 
 tion. In 1860 the total ordinary expenditures of 
 the Federal Government were but $63,130,000. 
 By 1900 they had shot up to $487,713,000. By 
 1908 they had still further increased to $659,196,000. 
 While the population increased 178 per cent, ex- 
 penditures increased over 1,000 per cent. A war 
 and a naval programme has been entered upon, 
 whose cost to the nation is now $294,000,000 a 
 year. The annual expenditure for pensions, even 
 
222 PRIVILEGE AND DEMOCRACY 
 
 with the war half a century away, amounts to 
 $154,000,000. The pension bill is higher to-day 
 than it was ten years ago. 
 
 We have reversed every principle of sound finan- 
 cing. We do not collect what we reasonably need; 
 we spend what the tariff, designed in the interest 
 of a class, produces. An expenditure of nearly 
 $350,000,000 for war, navy, and pension purposes 
 would meet with a far different reception were 
 taxes laid upon wealth rather than upon consump- 
 tion. The cost of the government would prob- 
 ably shrink to one-half its present volume were 
 privilege taxed instead of labor. For direct taxes 
 compel caution, scrutiny, and responsibility. In- 
 direct taxes breed extravagance, corruption, and 
 war. Congress would not even consider a ship 
 subsidy bill if privileged wealth paid the cost of it 
 all. War would come to an end to-morrow were 
 those who benefited by its happening compelled 
 to pay for its maintenance. There would be no 
 need of peace conferences were the government to 
 make forcible requisition on wealth before it made 
 requisition on human life. Were the billions ex- 
 pended annually on the armaments of the world 
 collected from direct taxes upon the land, upon 
 the railways, upon incomes and inheritances, every 
 agency of public opinion would be on the side of 
 peace. Were the rich and powerful classes the 
 first to suffer from a declaration of hostilities. 
 
AN OVERLOOKED CAUSE OF POVERTY 223 
 
 the press and every agency of public opinion would 
 be on the side of arbitration. Then there would 
 arise a demand for the settlement of the disputes 
 ' ' of the world that would be irresistible. Then the 
 financiers, who find in war a source of profit to 
 themselves, would coerce their rulers into a concord 
 of nations. For war only persists because the 
 privileged orders are able to throw its cost onto the 
 defenceless members of the community. 
 
 These are some of the costs of the tariff. It is 
 not an isolated fiscal question. It is not alone a 
 social question. The tariff is woven into every 
 fibre of our politics, from the smallest hamlet to 
 the United States Senate. Quoting again from 
 the letter to the Ways and Means Committee of 
 Congress, Mr. Charles Francis Adams says : " Mean- 
 while let me add, without any doubt in my own 
 mind as to the accuracy, and I may say the 
 moderation, of the statement, that in the heyday 
 of its strength and arrogance the old slave power 
 of the South was never so strongly intrenched in 
 its position, so defiant in its attitude, so corrupting 
 in its influence, so difficult to be overthrown, or so 
 utterly insatiable in its demands and so unscrupu- 
 lous in its methods of satisfying those demands, as 
 are to-day the combined tariff-protected interests of 
 the country. An overgrown octopus, their tentacles 
 are all-pervasive, as, from the self-interested point 
 of view, their arguments are convincing." 
 
224 PRIVILEGE AND DEMOCRACY 
 
 A superstition has been created about the poUcy 
 of protection which poisons every agency of public 
 opinion. It prevents its free discussion in the press, 
 the university, or in business circles. The ghost of 
 hard times is held up before the working man and 
 the farmer, the shopkeeper and the manufacturer. 
 The most scandalous abuses may not be corrected, 
 for fear of opening up the whole schedule. For, 
 once the principle of protection is questioned, the en- 
 tire superstructure may be undermined by inquiry. 
 The scandalous extortions of monopoly go on unre- 
 buked, because of the multitude of noisy interests 
 which make use of its power to protect themselves 
 from disturbance. 
 
 The protected interests obtained their control 
 during the Civil War. They have never been dis- 
 lodged. In a sense, they are now subordinate to 
 the railways, the transportation and the franchise 
 corporations, which have been invited to a share in 
 the plunder. With them are allied the banking 
 and financial institutions, which own the public 
 service corporations. In the West the land and 
 timber thieves are a part of the system. The rail- 
 roads, running into every state in the Union, form 
 the foundations of the merger. They lend the West 
 and South to the designs of the privileged East. 
 Their attorneys are active in local politics. They 
 are to be found in every state legislature. They 
 mould public opinion and draft party platforms. 
 
AN OVERLOOKED CAUSE OF POVERTY 225 
 
 They are a hireling class and justify their actions by 
 the serviceable ethics of the common law, which 
 commands a lawyer to represent whatever client 
 demands his services. 
 
 The railways are drawn into politics by the very 
 nature of their business. They are quasi-public 
 agents, they enjoy a portion of the sovereignty of 
 the state. They are the highways of modern civ- 
 ilization. The franchise corporations are natural 
 monopolies. They are made monopolies by law. 
 They occupy public property. Like the railways 
 and the protected interests, they are drawn into 
 politics, not to protect their property, but to pro- 
 tect their privileges, which in these instances are 
 the privilege of being a monopoly. They can only 
 avoid regulation or ownership by controlling the 
 government from which they draw their life. 
 
 We have seen that the capitalization of the rail- 
 ways has increased from $10,635,008,074 in 1897 to 
 $16,082,146,683 in 1907. During the same period 
 their gross earnings have grown from $1,122,089,773 
 to $2,589,105,578, while net earnings have in- 
 creased from $369,565,009 in 1897 to $840,589,764 
 in 1907. Like rent, the earnings of the railways and 
 the public service corporations grow with popula- 
 tion and industry. They need only provide the ser- 
 vice; the demand increases with each passing day. 
 This increased capitalization, earnings, and divi- 
 dends is largely society's contribution to their own- 
 
226 PRIVILEGE AND DEMOCRACY 
 
 ers.' For, while railway mileage increased but 22.2 
 per cent, from 1896 to 1906, railway dividends in- 
 creased by 200 per cent. 
 
 And it is to protect this "unearned increment," 
 this social value, from taxation and regulation, that 
 the railways find it necessary to become the govern- 
 ment. The monopoly tribute which they exact 
 in excessive rates and charges is not less than 
 $300,000,000 a year. Measured by a fair return 
 on the actual capital invested by the owners in the 
 property, it is probably twice this sum. The trib- 
 ute of the other public utility and franchiee corpora- 
 tions is $200,000,000 more. This is the annual 
 cost of the private ownership of the highways and 
 the public service corporations of the nation. 
 
 The local taxing authorities are controlled for the 
 same purpose. Not content with exemption from 
 Federal taxation, privilege has evaded the bulk of 
 its local taxes as well. The amount of the evasion 
 is colossal. For the year ending June 30, 1903, the 
 
 'This social value, this unearned increment, which railways en- 
 joy is recognized by privilege. It is the basis of the constant 
 watering of securities. Wall Street occasionally expresses it openly, 
 as in the following editorial from Moody's Magazine for January, 
 1909. It says, page 6: "There can be no cessation of this steady 
 growth in value of railroad property in a large sense as long as the 
 population of the country increases, rights of way and terminal 
 sites grow in value, and natural resources are opened up and de- 
 veloped. . . . Like the public utility corporation which enjoys a 
 perpetual franchise, and like the owner of realty in the heart of a 
 growing community, every year must automatically add to the 
 equity back of railroad securities, despite government regulation or 
 other ordinary legislation." 
 
AN OVERLOOKED CAUSE OF POVERTY 227 
 
 railways of the country paid in taxes the sum of 
 $57,797,737. In the year 1904 their commercial 
 value, as ascertained by the Census Bureau, was 
 $11,244,852,000/ The total taxes paid amounted 
 to but one-half of one per cent, on this value. Were 
 the railways assessed as are the farmer and the 
 home-owner they would have paid from $168,672,000 
 to $224,897,000.== 
 
 The evasions of the express, telegraph, sleeping- 
 car, pipe-line, fast-freight, telephone, street and 
 interurban railway, gas, water, and electric-light- 
 ing companies are equally colossal. They, too, are 
 assessed on but a fraction of their value. Only in 
 rare instances are their franchises taxed at all. 
 Prior to the passage of the franchise tax law in New 
 York in 1903, the public service corporations of the 
 state were assessed on their physical property. 
 This law increased their valuation by $235,000,000 
 in New York city alone. The constitutionality of 
 the law was contested from court to court. It was 
 finally affirmed by the Supreme "Court of the United 
 States.^ 
 
 ' Commercial Valuation of Railway Operating Property, Bulletin 
 21, Bureau of the Census, p. 8. This year is taken rather than a 
 later one because of the census valuation of 1904. 
 
 ^ Estimating ordinary taxes at one and one-half per cent, and two 
 per cent., respectively. 
 
 ' The capitalized value of the street and electric railways of the 
 country in 1902 was $2,308,282,000 or $139,778.7 a mile. (BuUetin 
 of the Census, Street and Electric Railways, p. 11.) This is from 
 two to three times their cost of construction. They paid in taxes 
 but $13,078,899 or approximately one-half of one per cent, on their 
 
228 PRIVILEGE AND DEMOCRACY 
 
 In 1905 the United States Steel Corporation paid 
 in taxes but $3,646,490. Its capitalization was 
 $1,637,811,000. The taxes paid were a trifle over 
 one-fifth of one per cent, on the value. Were the 
 Steel Trust taxed at the average rate of other prop- 
 erty, it would pay into the treasuries of the various 
 states at least $20,000,000, or six times its present 
 taxes. 
 
 Were we to add to these losses those of the coal 
 and the iron, the oil and the gas, the copper and 
 other mining monopolies, which are still assessed as 
 farming land and which have passed under the con- 
 trol of monopoly, we should have a total of tax 
 evasions by these interests in the neighborhood of 
 $100,000,000 a year. If to this were added the eva- 
 sions of the railways and the public service corpora- 
 tions, the grand total would amount to not far from 
 $250,000,000 a year. It may exceed this figure. 
 
 These are some of the spoils of privilege. These 
 are part of the tribute of monopoly. On the one 
 hand, a control of Congress. On the other hand, a 
 control of the states and the cities. Above is a 
 cruelly unjust system of indirect taxation which 
 
 valuation. They escaped from forty to fifty millions in taxes. The 
 total capital of the telephone companies in 1902 was $348,031,058. 
 The total tax paid was $2,944,281, or less than nine mills upon their 
 capital value. (Bureau of Census, Bulletin on Telephones and Tele- 
 graphs, p. 16.) In the state of Ohio alone it has been computed that 
 the public service corporations, including the railways, escape taxa- 
 tion on a billion dollars of value and evade the payment of from 
 fifteen to twenty millions annually. 
 
AN OVERLOOKED CAUSE OF POVERTY 229 
 
 exacts from one and a half to two billions annually 
 from the consuming class; below is an equally unjust 
 system of local taxation which increases the burden 
 by at least a quarter of a billion more. In nation, 
 state, city, there is a resistance to regulation and 
 ownership and a ceaseless struggle for still further 
 privileges. 
 
 When it is borne in mind that the total annual 
 production of wealth in America is $18,540,345,312,* 
 the cost of these law-made privileges is apparent. 
 The burden of indirect taxation, of monopoly rates 
 and prices, and the evasion of local taxes, all made 
 possible by the control of the government by these 
 privileges, is equal to one-eighth and possibly one- 
 sixth of all the wealth there is to distribute. It 
 probably exceeds the total amount distributed each 
 year in wages to American labor.^ 
 
 Herein is an overlooked cause of poverty. It is 
 not the chief cause. That is to be found in the 
 private ownership of the land and the burden of 
 rent which it involves. But when we consider that 
 these taxes must be paid from out the current 
 wealth that is produced, and that the bulk of them 
 are paid by those who toil, the reduction in the 
 standard of living of the mass of the people is 
 obivous. Nearly all of the Federal revenues come 
 
 'Census estimates of 1900. 
 
 ^ In 1900 the total wages paid in America amounted to S2,234,> 
 453,993.— United States Census, Vol. VII, 
 
230 PRIVILEGE AND DEMOCRACY 
 
 from the poorer classes, for the tariff and the excise 
 taxes are adjusted to the articles of universal con- 
 sumption. They would yield but little revenue if 
 this were not true. The monopoly charges of the 
 interests protected by the tariff reduce the standard 
 of living still further. They, like the Federal and 
 the local taxes, are collected from consumption. 
 They enter into the cost of every article that we 
 consume. They are collected over and over again 
 in the process of production and distribution. They 
 are paid by pennies, dimes, and dollars, and chiefly 
 by the poor. 
 
 Privilege, untaxed on what it owns, thus levies 
 a double tribute upon humanity. It compels the 
 consumer to maintain a government whose expen- 
 ditures are largely devoted to the promotion of its 
 interests, while, in addition, it compels him to pay 
 excessive prices for all that monopoly produces and 
 all of the services which it renders. 
 
CHAPTER XIX 
 THE CAUSE OF CIVILIZATION AND DECAY 
 
 We are now in a position to explain the inquiry 
 with which we started. We can now understand 
 why it is that, in spite of the advances in the arts 
 and sciences and with all of the improvements in 
 the means of production, poverty continues to 
 intrude, like a poor relation at the feast. We can 
 now understand why the discoveries of the mechani- 
 cal world pass over society, like a rain-laden cloud 
 over a thirsty desert, and leave humanity but little 
 better off than it was before. It is also possible 
 to unravel the mystery of history; to explain the 
 laws which govern the rise and fall of nations and 
 the destruction of whole peoples in the midst of 
 their splendor. 
 
 We have missed the purpose of organized govern- 
 ment. We have perverted the state from its proper 
 ends. We have exalted privilege above liberty and 
 the rights of property above humanity. In this is 
 to be found the explanation of the unequal distri- 
 bution of wealth. It is not due to any natural 
 inequalities in the endowments of men. The 
 princely fortunes which have come into existence 
 
 23X 
 
232 PRIVILEGE AND DEMOCRACY 
 
 during the past few years are not traceable to thrift, 
 intelHgence, or foresight on the part of their owners 
 any more than the wide-spread poverty of the masses 
 of the people is due to the lack of these virtues on 
 their part. The laws of the land are responsible for 
 the billionaires, just as they are responsible for the 
 doc.k laborers; they are responsible for the Waldorf- 
 Astoria, just as they are responsible for Packing- 
 Town. 
 
 The American people are between the upper and 
 the nether millstones of law-made privileges. Above 
 are the cruelly oppressive taxes of the Federal 
 Government, which exact from one and a half to 
 two billion dollars a year from those who labor. 
 Below are the rent of the land, the monopoly charges 
 of the mine-owners, the railways, the transporta- 
 tion agencies, and the other public utUity corpora- 
 tions, as well as the countless other monopoUes, 
 which are identified with the land or are directly 
 traceable to the tariff or the railways, and which 
 exact from three to four billion dollars a year more. 
 Struggling between these law-made privileges are 
 80,000,000 of people, whose political institutions 
 have fallen under the control of a class. The heart 
 and the brain of this merger is in Wall Street. Its 
 tentacles reach out into the humblest home in the 
 land. It pursues its purpose with no concern for 
 the nation's welfare. It is deaf and dumb to any 
 appeal save self. It differs from the privileged 
 
CAUSE OF CIVILIZATION AND DECAY 233 
 
 orders of other lands only in the magnitude of its 
 operations. History is filled with examples of gov- 
 ernment by a class, but history nowhere records a 
 nation of free men, endowed with the ballot and 
 safeguarded by laws of its own making, permitting 
 its highways, its resources, and its machinery of 
 taxation to be made the plaj^hing of stock- jobbing 
 interests, in which the stakes involved are the 
 control of a continent and the well-being of 
 80,000,000 of the most highly educated people of 
 the globe. Yet such is not an exaggerated picture 
 of what has happened to America during the past 
 few years. 
 
 Whoever controls these agencies controls a 
 people's destiny. They can decree comfort, con- 
 tentment, and happiness, just as they can decree 
 poverty, misery, and decay. That an increasing per- 
 centage of the wealth of the world is not enjoyed by 
 those who produce it the preceding pages indicate. 
 That this must be true is demonstrated by deduc- 
 tive as well as by inductive logic. For there are 
 only three possible claimants to the wealth that is 
 produced: the landlord, the capitalist, and the 
 wage-earner. If an increasing share goes to rent, 
 the returns of capital and labor must be reduced 
 pro tanto. According to the United States Cen- 
 sus the wealth produced in 1900 amounted to 
 $18,540,345,312. This included all kinds of farm 
 products, the output of the mines and of manu- 
 
234 PRIVILEGE AND DEMOCRACY 
 
 facturing plants.' The per capita wealth produced 
 was $234.04, or $1,170.20 for every family of five in 
 the country. This was all there was to be dis- 
 tributed. We have seen that the land values of 
 the country, including as land values the sites of 
 the railroads and public service corporations, are 
 at least $40,000,000,000. They probably exceed 
 $60,000,000,000. Manifestly these values can only 
 exist because they yield an income which warrants 
 this valuation, which, calculated at five per cent., 
 amounts to from $2,000,000,000 to $3,000,000,000 
 per annum. This is land rent. It is the annual 
 tribute of the unearned increment. It can only be 
 paid from out the current production. The wealth 
 to be divided between capital and labor is reduced 
 by this charge. 
 
 At least $2,000,000,000 more is taken through 
 indirect taxes on consumption and the monopoly 
 charges which the protected interests exact, while 
 from $500,000,000 to $700,000,000 is appropriated 
 by the railways and the public utility corporations 
 in excess of a reasonable charge for the services 
 which they render. 
 
 Out of the $1,170.20 per family, at least $300.00 
 
 'The production of wealth was divided by the census as follows: 
 
 Farm products valued at $4,739,118,752 
 
 Mineral products valued at 796,826,417 
 
 Manufactured goods valued at 13,004,400,143 
 
 Total production $18,540,345,312 
 
 Twelfth Census of the United States, see Special Reports. 
 
CAUSE OF CIVILIZATION AND DECAY 235 
 
 a year is taken in rent, consumption taxes, and 
 monopoly charges. This estimate is conservative. 
 I am convinced that the tribute thus exacted is 
 not far from one-third of all of the wealth produced. 
 It is probably in the neighborhood of an average of 
 $400.00 per family. 
 
 But the wage-worker does not receive anjiihing 
 like his per capita proportion of the wealth pro- 
 duced. The average wage is below $450.00 a year. 
 The census estimate, as we have seen, is but $432.40. 
 Yet the part of the wage-earner's income appropri- 
 ated by privilege is undoubtedly in excess of one- 
 third of his income. This is the cost, to those who 
 toil, of the private ownerships of the land, and the 
 control of the government by an economic class. 
 
 So long as these conditions continue the poor 
 must become poorer, just as those who own the 
 land and the resources and the public service cor- 
 porations must of necessity grow richer. The 
 growth of population insures this. Already millions 
 are in poverty, while a score of millions have noth- 
 ing save the morrow's wage between them and des- 
 titution. And with each passing day those on the 
 dead-line of poverty must increase in number. 
 From now on the standard of living of those who 
 have nothing but their labor to sell must of necessity 
 fall. To-morrow the purchasing power of wages 
 will be less than it is to-day. So will the chance 
 of employment. This is the inevitable result when 
 
236 PRIVILEGE AND DEMOCRACY 
 
 the land and the highways and the politics of a 
 people are in the hands of an ascendant class. By 
 a perfectly logical process, those who own the land 
 will take all that the tax-gatherer does not. The 
 landlord is the residual claimant of all that is 
 produced. 
 
 That this is true is evidenced by the incomplete 
 statistical data which we possess. Wages should 
 have increased in recent years, but as we have seen 
 they were actually lower by seven per cent, in 1900 
 than they were in 1890, while the cost of living had 
 materially increased.' At the same time the earn- 
 ings of one class and one class alone have increased. 
 Rent increased 52.43 per cent, in Massachusetts in 
 five years' time.^ It is rapidly advancing all over 
 the country. Railway gross earnings doubled in 
 ten years, while the dividends of mine and fran- 
 chise corporations have shown a similar advance. 
 These are the privileged interests. Their earnings 
 alone respond to the growth of population. All 
 other classes, even the competitive capitalist, suffer 
 by reason of it. 
 
 Among the unprivileged ones competition plays 
 and plays fiercely. There is free trade among the 
 producing classes. The tariff laws do not extend to 
 those who toil. The doctrine of laissez faire is but 
 slightly relieved by the trades-union. A million 
 
 ' See chap. XV, " The Future of Labor." 
 ^Idem. 
 
CAUSE OF CIVILIZATION AND DECAY 237 
 
 incoming immigrants each year render the struggle 
 that much the more remorseless. They, too, find 
 the resources of the country appropriated, the land 
 enclosed. They, too, are imprisoned by privilege, 
 the privilege of those who own and the privilege of 
 unjust taxation. The millions added by the birth 
 rate make the struggle that much more hopeless, 
 just as they make the tribute which privilege exacts 
 that much the heavier. 
 
 Only the wage-earner and the farmer, the retail 
 dealer and the unprotected manufacturer remain to 
 give reality to the teachings of political economy. 
 For it is only among these classes that competition 
 plays. 
 
 To this burden of rent and of indirect taxes must 
 be added another and an even more important ele- 
 ment in determining the well-being of a people. 
 Rent and taxation control the standard of living 
 through distribution. But production is likewise 
 strangled in the process, through the speculative 
 withholding of the land and resources from use. 
 This is the costliest burden of all. Labor could 
 carry the burden of rent, it could carry the burdens 
 of indirect taxation, were it free to employ itself 
 where opportunity called or instinct suggested. 
 But the private ownership of the land stifles talent, 
 it limits capital no less than labor to the work which 
 is nearest at hand. Not agriculture, not mining, 
 not the elementary processes of production alone, 
 
238 PRIVILEGE AND DEMOCRACY 
 
 would be awakened by the freeing of the land from 
 the hand of the speculator, but numberless other 
 industries would come into life by the opening up of 
 the resources of nature to be used by those who 
 are most fitted to occupy them. 
 
 The cost of the processes which have been enu- 
 merated are the costs of poverty wherever it ap- 
 pears. Poverty means destitution, sickness, lack of 
 education. It means undernourishment for the 
 worker and his offspring. Poverty breeds vice and 
 crime. Nine-tenths of the crime of the community 
 is traceable directly or indirectly to industrial 
 causes. It is social. It is from the poor of the 
 community that the tramp and the vagrant are 
 recruited, it is from this class that the workhouse is 
 replenished. Poverty fills the streets with unfort- 
 unate women, the most pitiful wreckage of the city. 
 It is poverty that breeds the criminal of to-morrow 
 from the boys and girls on the streets to-day. They 
 enter the sweat-shop and the department store 
 while yet in tender years. They do not receive a 
 living wage. They are worked to exhaustion. They 
 are driven to the streets by hunger itself. They 
 gladly accept the alternative of "a short life and a 
 merry one" in exchange for all that hope holds out 
 for them. Thus poverty is the mother of vice, of 
 crime, of prostitution. And this wreckage is of our 
 own making. 
 
 And it is apparent that the tide of poverty is con- 
 
CAUSE OF CIVILIZATION AND DECAY 239 
 
 stantly rising. It engulfs one class after another. 
 From the unskilled it passes on to the skilled 
 laborer. From him it extends to the clerk and the 
 small shopkeeper. In time, it laps at the feet of 
 those who have heretofore enjoyed comparative 
 security. Under existing conditions the tide of 
 poverty canpot recede. It never will recede until 
 the nation itself begins to ebb. For the line of 
 poverty creeps up with the line of rent, slowly 
 reducing the standard of living of all classes save 
 those who own the land. 
 
 It is at this point that a nation begins to decay. 
 A people without hope is a people without initiative. 
 Ambition lives only with opportunity. Education, 
 art, skill, literature, invention, are all postulated on 
 economic well-being. The arts cannot live where 
 the worker is compelled to struggle for the barest 
 necessities of life. Political liberty itself is but a 
 reflection of the economic foundations of a people. 
 The same is true of industry. Culture and civiliza- 
 tion mirror the industrial freedom or servitude of 
 a nation. Men must be economically free before 
 they can be much else. And this is impossible where 
 the right to work is as hazardous, and the returns of 
 the worker are as insignificant, as they are to-day. 
 
 Even industry is threatened by these conditions. 
 The recent hard times were due to land speculation 
 and the growth of rent. For capital is dependent 
 upon the well-being of tne working classes. A 
 
240 PRIVILEGE AND DEMOCRACY 
 
 people cannot buy if they are compelled to pay all 
 that they produce for the mere right to be upon 
 the earth. That is the condition of the tenement 
 dwellers of our cities. It is the condition of the 
 workers in the mines. It is rapidly becoming the 
 condition of the agricultural' worker as well. They 
 are too poor to provide a market for industry. 
 Ultimately the landlord will impoverish the capi- 
 talist class as well as the worker. 
 
 I am convinced that, under existing conditions, 
 progressive industrial and social decay is a matter 
 of a relatively short time. Just as a single loaf of 
 bread commands everything save life itself between 
 two starving men, so land, even in a nation like our 
 own, will command famine prices as soon as it is 
 all appropriated. It may be a generation before we 
 face the problem in all its acuteness, but there 
 is every indication that the burden of rent and the 
 monopoly of the land have already started America 
 on a downward path, not unlike that which older 
 nations have followed. That science does not 
 accept this explanation of social conditions, is no 
 more remarkable than the refusal of the Church to 
 accept the evolutionary hjrpotheses of Darwin and 
 of Spencer: it is no more remarkable than the 
 refusal of the plantation owners of the South to be 
 convinced of the wrongness of human slavery; or 
 of the protected industries to see the costly con- 
 fusion of the tariff. All of the traditions of political 
 
CAUSE OF CIVILIZATION AND DECAY 241 
 
 economy are founded upon the idea of private 
 ownership of the land. As a science, it assumed 
 form and shape in the land of all others where the 
 land-owning classes are most dominant. More- 
 over, political science as well as jurisprudence is 
 the heritage of twenty centuries of control by the 
 landed classes. Added to these influences, all of 
 the traditions of America are those of an immense 
 and inexhaustible public domain, of free land in 
 abundance to any one who wanted it. Woven in 
 and out of the teachings and thought of the people 
 is the idea that the private ownership of the land is 
 sanctioned by the laws of nature if not of God. 
 With these burdens of tradition, of class interest, of 
 jurisprudence, and of ignorance, it is no wonder 
 that political economy has been slow to challenge 
 the idea of the private ownership of the land, or 
 statesmen or political scientists to question its 
 propriety. 
 
 Yet the experience of all history confirms this 
 interpretation, an interpretation which is as re- 
 morseless in its logic as any proposition of Euclid. 
 The effects of land monopoly, of the struggle of the 
 people for its use, these, together with the effects of 
 the rule of a class upon the destinies of a people, 
 are to be seen in the history of all nations from the 
 first recognition of private property in land. The 
 right has been challenged by many thinkers, by 
 social reformers and agitators in every age. It 
 
242 PRIVILEGE AND DEMOCRACY 
 
 is only in the present generation that universal 
 suffrage, a free press, and representative govern- 
 ment have made the challenge audible. Two re- 
 cent French writers, examining the history of the 
 Hebrew, Greek, and Roman peoples, say: 
 
 "A regime where there is no limit to the extension 
 of individual property, no tempering of its enjoy- 
 ment, no responsibility in its exercise, where interest 
 and taxes take from labor the best of its produce, 
 excludes the majority from the owning of any prop- 
 erty. Then classes form. Their division becomes 
 more marked, struggles break out, the invader 
 arrives, and the nation is destroyed. This is the 
 history of the republics of Greece, Carthage, and 
 Rome. One people alone continues through all 
 antiquity — the Hebrew people. It resists all time, 
 survives even migration as a people. According 
 to the Mosaic law, everything here below belongs 
 to the Lord and man is but the user, obliged to 
 conform to the conditions fixed by the divine order; 
 conditions which have for their aim the assurance 
 of the union of the land and the family, and to 
 preserve to the needy a legitimate part of the re- 
 sources of the earth." ' 
 
 "^La Question Agraire, by Meyer and Ardent, p. 12. 
 
CHAPTER XX 
 
 THE ECONOMIC FOUNDATIONS OF MORALS 
 
 Just as the politics of a country reflect the inter- 
 ests of an ascendant economic class, so the ideas 
 of right and wrong of any age mirror the will of 
 the same economic ascendancy. Ethics, the cur- 
 rent sense of morality, even the criminal laws are 
 made to serve a class. So too the agencies of public 
 opinion are enlisted in its service. The press is 
 largely owned by the privileged interests. News 
 and publicity bureaus are organized and con- 
 sciously employed for the purpose of moulding pub- 
 lic opinion, while the press that is free is colored 
 by the same influences. Even the universities, 
 both those that are privately endowed as well as 
 those that are supported by the state, the institu- 
 tions for scientific research as well as the Church, 
 the philanthropic agencies, and the learned pro- 
 fessions, are all dependent upon those who have 
 favors to grant. They are unconsciously coerced 
 into an alliance with the economic interests that 
 are dominant, just as they were in the days of 
 feudalism, when the learned professions, the bench, 
 the bar the Church, and the universities, were the 
 
 24? 
 
244 PRIVILEGE AND DEMOCRACY 
 
 servitors of the ruling aristocracy. It is these 
 agencies which make the morals and the public 
 opinion of an age. 
 
 That the morality of an age is moulded by the 
 interests of the ascendant class has frequently been 
 remarked by those who were not socialists. 
 
 "Whenever there is an ascendant class," says 
 John Stuart Mill, "a large portion of the morality 
 of that country emanates from its class interests 
 and its feelings of class superiority. The morality 
 between Spartans and Helots, between planters and 
 negroes, between princes and subjects, between 
 nobles and roturiers, between men and women has 
 been, for the most part, the creation of these class 
 interests and feelings." ' 
 
 And the ideas of right and wrong in America are 
 essentially the ideals of the privileged class. The 
 current conceptions of liberty and of duty, of obedi- 
 ence and of reverence, of submission and content- 
 ment have been implanted in our minds by these 
 influences. So are our ideas of crime. It is not so 
 much that the rich offender is not as rigorously 
 prosecuted as are the poor for the same offence. 
 It is the absence of a moral code or penal statutes 
 directed against the offences of the ascendant class 
 that stamps the ethics of to-day as class ethics. 
 We can see this in the criminal codes of our states. 
 Crimes against property are relatively more serious 
 
 'Essay on "Liberty," 
 
ECONOMIC FOUNDATIONS OF MORALS 245 
 
 than crimes against the person, while crimes against 
 the state, and especially crimes against society, are 
 scarcely provided for at all. Thus the criminal 
 code of New York provides a maximum sentence of 
 ten years' imprisonment for criminal assault with 
 intent to kill or commit a felony, and a minimum 
 sentence of ten years' imprisonment for first degree 
 burglary. The minimum punishment for rape and 
 for manslaughter in the first degree is twenty years' 
 imprisonment, while for arson it is forty years' 
 imprisonment. The abandonment of a child under 
 six years of age is punishable by a maximum sen- 
 tence of seven years' imprisonment, while the sale 
 of impure food, even though it may poison a whole 
 community, is only a misdemeanor, and the viola- 
 tion of laws for the protection of railway workers 
 from death and accident is punishable only by a 
 fine of $500. 
 
 The offences of the ascendant class against those 
 who are dependent upon them, or for a breach of 
 trust to the many, are but mildly punished. Cer- 
 tain kinds of fraud by the directors and officers of 
 a bank by which thousands of depositors may be 
 robbed of their savings are punishable by imprison- 
 ment for but one year and a fine of $500, or both; 
 while a corporation which commits an offence which 
 would be a felony were it committed by an indi- 
 vidual may only be fined, and then not in excess of 
 $5,000. 
 
246 PRIVILEGE AND DEMOCRACY 
 
 The same class instinct characterizes the Federal 
 law. Bribery of a member of Congress is punish- 
 able by three years' imprisonment; while the 
 counterfeiter of a coin may be sentenced to ten 
 years of hard labor. Moonshine or illicit distilling 
 by the poor whites of the South to defraud the 
 revenue is ruthlessly pursued; while smuggling, 
 which is an offence of the richer class, and for the 
 same motive, is practically ignored. All of the 
 power of the National Government is turned against 
 him who rifles a mail-bag; while he who rifles a 
 nation of a million-acre estate is unmolested in his 
 theft, and even more rarely punished for it. 
 
 When it comes to the administration of the law, 
 the disproportion is even more conspicuous. Our 
 penal institutions are filled with minor offenders 
 who, in the great majority of instances, have been 
 driven to the commission of some petty offence 
 by industrial conditions over which they have no 
 control. In the police courts of our cities men 
 and women are committed to the workhouse at the 
 rate of a score every hour, and are started on a 
 career of vice and crime which destroys every 
 chance of recovery, and in many instances leads 
 inevitably to the penitentiary. 
 
 The corrupt alderman who accepts a bribe is 
 shunned by all men, and his prosecution is vigor- 
 ously supported by public opinion and reform or- 
 ganizations, while he who gives the bribe is often 
 
ECONOMIC FOUNDATIONS OF MORALS 247 
 
 f^ted by his associates, and the prosecuting attorney 
 who would indict him as a criminal is treated as a 
 social pariah/ While he who innocently buys a 
 stolen horse gets no better title than the thief, 
 he who knowingly buys a stolen franchise is pro- 
 tected by the courts in his grant. Jacob Sharp 
 and his associates were sent to Sing Sing for cor- 
 rupt connection with the Broadway Street Railway 
 franchise in New York; but the franchise itself was 
 upheld, even though the title was known to be 
 tainted with fraud. 
 
 The same class ethics appear in the proceedings 
 against the railways and industrial combinations, 
 and the land and timber thieves of the West. 
 These offences involve hundreds of millions of dol- 
 lars. They are knowingly committed against a 
 sovereign state. Their number runs into the tens 
 of thousands. Yet there have been rare imprison- 
 ments of the offenders, and but few fines collected. 
 Anti-trust laws and laws against rebates and dis- 
 criminations are still openly ignored. The orders 
 of the Interstate Commerce Commission are con- 
 temptuously violated, while mine operators and 
 manufacturers refuse to obey the laws for the pro- 
 tection of their employees.^ 
 
 1 For examples of evidence of this class-conscious morality see the 
 contemporary accounts of the graft prosecutions in St. Louis and San 
 Francisco and the attitude of the press and public opinion toward 
 Folk and Heney. 
 
 ' Within the last year the case of the United States against the 
 Standard Oil Company for violation of the statutes directed against 
 
248 PRIVILEGE AND DEMOCRACY 
 
 It is not alone that these offences are committed. 
 It is the acquiescence on the part of the pubHc in 
 their commission that stamps the ethics of the day 
 as those of a class. We do not protest against the 
 crimes of the business world, certainly not as we 
 protest against the offences of organized labor or 
 of those who violate the excise laws of the state. 
 The offences of the former do not fall within the 
 present day ethical code, neither do they violate the 
 public opinion which makes that code. But the 
 same public opinion rings with outraged morality 
 at the action of the Western Federation of Miners, 
 the boycott of an "unfair" house, or the criticism 
 of a decision of the courts by the representatives of 
 organized labor. It is aroused to frenzy over the 
 tyranny of the closed shop, but not over the tyran- 
 nies of the closed corporation. 
 
 It demands as a sacred and inviolable right the 
 freedom of the non-union man to work where he 
 will, irrespective of organized labor, but denies in 
 the same breath the sacred and inviolable right of 
 the same man to buy or sell in the markets of the 
 world irrespective of organized capital, unionized 
 by the tariff. Privilege compares the dilatory 
 criminal proceedings of the American courts with 
 the expeditious punishment of offenders in England, 
 
 rebates was dismissed by the courts, while the officers of the Ameri- 
 can Federation of Labor were committed to jail for alleged violation 
 of a court order. 
 
ECONOMIC FOUNDATIONS OF MORALS 249 
 
 but makes no reference to the prolonged delay in 
 the payment of franchise taxes by the corporations 
 of New York city or the litigation over the eighty- 
 cent gas legislation in that state. It is silent about 
 the endless litigation over every petty order of the 
 Interstate Commerce Commission, the statutes of 
 our states, or the exhausting policy adopted to 
 resist the pajrment of personal injury claims by the 
 corporations. It identifies itself with agitation to 
 close the saloon and to punish petty vice, but 
 betrays no interest in any movement to discover 
 the cause of these evils or to control the privileged 
 interests which lie back of their existence. 
 
 How, it may be asked, does all this accord with 
 the recent activity of the state and the nation 
 against the big business interests? As a matter of 
 fact, there comes a time in the evolution of class 
 morality when the very excesses of the dominant i 
 class must be checked in order to preserve the class. 
 And an examination of the recent legislation against 
 corporate abuses will show that it is designed for the 
 protection of the ascendant class rather than the 
 destruction of its privileges. The worst offenders 
 must be held in check. Monopoly must be regu- 
 lated or it will be destroyed; the railways must 
 abandon discrimination if they would check the 
 movement for government ownership. The more 
 far-sighted owners of the franchise corporations have 
 approved of the creation of state commissions for 
 
250 PRIVILEGE AND DEMOCRACY 
 
 the same purpose, just as the brewers and distillers 
 have drafted model license laws to check the move- 
 ment for prohibition. Such restrictive legislation 
 is designed to save the institution, by the creation 
 of a legal code which will restrain the irresponsi- 
 ble offender. By these means the public will be 
 diverted from the fact that the institution itself is 
 wrong, to the idea that it is the occasional offender 
 who is at fault. 
 
 The same sinister influence exercises its power 
 over the agencies of public opinion. It tempers 
 the pulpit and the university. It limits discussion 
 to other than vital questions. The abuses of the 
 business world, and the wrongs of humanity, are 
 excluded from investigation. Preferment is closed 
 to those who look too closely into the cause of 
 existing conditions. The daily press is even more 
 openly controlled. Editorial discussion is for the 
 most part commonplace, while the news columns 
 are made to mirror the will of the counting-room. 
 News and telegraphic agencies are controlled with 
 the same end in view, while at Washington and in 
 the capitals of our states subsidized news and plate- 
 matter bureaus are maintained which feed the 
 rural papers with matter favorable to the interests 
 which support them. 
 
 The metropolitan press as well as that of the 
 larger inland cities is largely owned by the franchise 
 corporations or other interests, or is subjected to 
 
ECONOMIC FOUNDATIONS OF MORALS 251 
 
 such pressure through its advertising patrons that 
 it is muzzled. This fact is admitted by many- 
 editors who deplore it. The Philadelphia North 
 American asserts that the press of America is no 
 longer to be trusted. It says: 
 
 "The influence for real, patriotic, right thinking 
 exerted by the daily newspapers of America was 
 dwindling almost to the degree of degeneracy. 
 . . . The world's strongest people are sinking 
 into subserviency to a sordid power, only because 
 the people were being served by a press that was 
 worse than subsidized, a press that had become 
 enslaved. . . . The predatory interests were not 
 slow to estimate how easily they could control 
 certain newspapers by the granting or the with- 
 drawal of profits. From the allotment of official 
 printing in the cities to the appointment of an able 
 and, therefore, a dangerous man in the town to be 
 pastmaster, by grace, of a corrupt state machine, 
 the system has been the same. 
 
 "Debauchery has come from many an angle. 
 The same bankers, suppliant to Wall Street, are the 
 ones from whom favors were asked by newspaper 
 managers, cramped financially, to keep pace with 
 modern development. Volumes instead of brief 
 comment could be written concerning pressure 
 brought to bear by railroads, the liquor traffic, the 
 poisoners of food and medicines, the promoters of 
 swindling mining and other stock schemes. 
 
 "But two things above all others stand out as 
 factors in the lessening of the influence of the daily 
 press: The first is the purchase of newspapers by 
 rich men utterly destitute of any comprehension of 
 the right function of journalism. Jay Gould failed 
 
252 PRIVILEGE AND DEMOCRACY 
 
 in his attempt at this sort of prostitution of public 
 opinion. From Huntingdon in CaUfornia, to Mor- 
 gan and Belmont in New York, and from 'Fingy' 
 Connors in Buffalo, to Oliver in Pittsburg, we have 
 only too many proofs that the plan now succeeds." 
 
 It is by ownership, by advertising coercion, by 
 the distribution of official printing, by the control 
 of the news agencies, but most of all by the coercive 
 power of the banks, to which the newspaper of the 
 day must go, that the making of news as well as 
 the public opinion which emanates from the press 
 has passed into the hands of the predatory class. 
 They not only make or mar the career of political 
 leaders who are inimical to privilege, they distort 
 and color the facts which take place. As the North 
 American says, when the newspaper ceased to be 
 an agency of enlightened public opinion a new 
 agency arose to take its place. The weekly and 
 monthly magazine has become the tribune of fear- 
 less speech. 
 
 And just as the economic interests of the ascendant 
 class mould the ethics of an age, so the same economic 
 interests mould our outlook on the past. History 
 is written by men from the same class which makes 
 the public opinion of to-day. Their standards of 
 right and wrong are those of the class to which they 
 belong. It is for this reason that history is blind, 
 just as are the law and contemporary opinion, to the 
 crimes which have been committed against hu- 
 
ECONOMIC FOUNDATIONS OF MORALS 253 
 
 manity. The eye of research is closed to the great 
 social forces which underlie the decay of nations and 
 the destruction of liberty by the aggressions of the 
 privileged orders. We read the chronicles of Greece, 
 of Rome, of Spain, or of Great Britain almost in vain 
 for any guidance in the solution of the menacing 
 problems which confront the twentieth century. 
 Like the science of political economy, history stops 
 short at the interpretation of social movements. 
 The science of history awaits some great mind like 
 that of Darwin to construct from out the neglected 
 records of the past the evolution of the economic 
 foundations of society. When that has been done we 
 shall see that the great crimes of history, like those 
 of the present day, are not those upon which the 
 historian dwells. The great crimes across the face 
 of Christendom are those which have enjoyed every 
 sanction which the law could give. They were 
 environed, just as they are to-day, with every ap- 
 proval which respect could add. They were achieved 
 so quietly that the voice of protest was stilled. Yet 
 the effects of these crimes linger on from generation 
 to generation, even from century to century. 
 
 When we see history in its real perspective, it will 
 be apparent that the great crimes of every age have 
 been committed through legislation. They will be 
 found carefully written upon the statute books of 
 the age. They are the crimes of an ascendant class 
 in control of the government, making use of that 
 
254 PRIVILEGE AND DEMOCRACY 
 
 control for the impoverishment of their peoples. 
 When history is so written, we shall see that the ser- 
 vitude, the poverty, the famines, and the ruthless 
 destruction of peoples is the product of law. We 
 need not go back to the Roman senate, to the 
 privileged orders in France, to the crimes against 
 Ireland by the landlords of England, for proof of 
 this statement. Confirmation may be found in the 
 law-made crimes of America, as well as of Europe, 
 to-day. For law is the handmaiden of absolutism 
 just as it is of freedom, of endless wars as well as of 
 peace, of slavery as well as of liberty, of decadence 
 as well as of splendor. Through privileges created 
 by law untold millions have died of starvation. 
 Through privileges created by law untold millions 
 are suffering from starvation and disease in America 
 to-day. Through class-made law civilization has 
 been set back centuries in its growth, while liberty, 
 the liberty that involves the economic as well as 
 the political freedom of the individual, has all but 
 disappeared from the face of the Western world. 
 
CHAPTER XXI 
 THE REMEDY PROPOSED 
 
 How may all this be altered? How can the land 
 be opened up to use by those who desire it, how 
 can monopoly be destroyed, the burden of rent be 
 reduced, the cost of living be brought down, and the 
 opportunities for labor and capital increased? How 
 can the gains of civilization be made to serve all 
 mankind instead of a diminishing few? How can 
 want and the fear of want be abolished from the 
 earth, and justice, equality, and plenitude be in- 
 sured to all? 
 
 There are two and only two solutions of the 
 social problem which confronts the civilized world. 
 One is industrial socialism. The other is industrial 
 freedom. From the time of Plato down to Karl 
 Marx men have dreamed of Utopias, based upon a 
 society consciously organized, and controlling the 
 agencies of production and distribution for the com- 
 mon welfare. In every age, too, men have painted 
 pictures of the alternative of industrial freedom; 
 of the society which would result from the abolition 
 of class-made laws and legalized privilege. The 
 most eminent of the latter were the French philoso- 
 
 255 
 
256 PRIVILEGE AND DEMOCRACY 
 
 phers of the eighteenth century, of whom Quesnay, 
 Turgot, Gournay, and the elder Mirabeau were the 
 most brilliant. It was Henry George, however, who 
 discovered the means by which industrial liberty 
 could be secured; it was he who evolved a philosophy 
 as complete as socialism itself. It is this alternative 
 of industrial freedom I propose to consider. 
 
 If the previous analysis of the economic founda- 
 tions of America no less than of Europe is correct, 
 the unjust distribution of wealth, the misery and 
 much of the vice and crime of to-day are the products 
 of man-made laws. Organized government itself 
 has created the Frankenstein monster of the social 
 problem. And if these evils are the result of law, 
 obviously they can be corrected by the same agency 
 that created them. They can be corrected by free- 
 dom. Nature is as jealous of her methods as she is 
 of her laws. And the law of nature is the law of 
 liberty. 
 
 Liberty involves no complicated organization of 
 society, no bureaucracy, no increase in the func- 
 tions of the state. Liberty involves rather repeal; 
 it involves the abolition of the privileges which have 
 been created by Congress, the state legislatures, and 
 city councils. It involves the freedom to buy and 
 sell where one wills; the freedom of the highways 
 and the freedom of access to the resources of nature. 
 Freedom involves the razing of all tariff walls, and 
 the abolition of all excise and internal revenue taxes 
 
THE REMEDY PROPOSED 257 
 
 on trade, industry, and commerce; it involves the 
 ownership of the railways and the means of trans- 
 portation by the people, and the abandonment of all 
 taxes on labor and labor products, and the nation- 
 alization of the land through taxation. 
 
 This is the philosophy of the single tax, of the 
 taxation of land values, as it is called in England, 
 first proposed by Henry George. He did not lay 
 claim to its discovery. He found it in the writings 
 of the French physiocrats, in the teachings of 
 Moses, as well as in the all but universal experiences 
 of early peoples. 
 
 The simplicity of this proposal delays its accept- 
 ance. Yet any one who will follow the forces which 
 would be released by such legislation will acquire 
 a philosophy of life as adequate as that of socialism 
 itself. He will find in it a law of perfect justice in 
 human society, a law which insures to the worker 
 to-day, to-morrow, and forever, equality with his 
 fellows and an assurance of the full product of his 
 toil. He will find a means by which monopoly will 
 be destroyed and industrial liberty re-established; 
 he will discover a means to terminate the present 
 unjust distribution of wealth. This remedy, too, is 
 sanctioned by all that science teaches us of the laws 
 of evolution; it is sanctioned by a thousand proofs 
 of history and contemporary society, as well as by 
 the precepts of justice and Christianity. It is a 
 solution that relies upon the known instincts of 
 
258 PRIVILEGE AND DEMOCRACY 
 
 humanity, and accords with all of the traditions 
 of American democracy. 
 
 In a quarter of a century the taxation of land 
 values has become social philosophy to millions of 
 men in every corner of the civilized world. It is 
 the inspiration of the political movements in a 
 dozen states and cities, and in a limited sense is the 
 political programme of the Liberal party in Great 
 Britain. It is a philosophy which divides the world 
 with the followers of Socialism, and in its final 
 analysis is a gospel of liberty and pure democracy. 
 
 The remedy which is here proposed is open to 
 adoption by the simplest of changes. It involves 
 no violent alteration in the machinery of government 
 or the organization of the state, no violent break 
 with that with which we are familiar, no departure 
 from the traditions of the functions of government, 
 no bureaucracy or centralized control over the Hfe 
 or activity of the individual. There would be no 
 new machinery; rather much that is now necessary 
 would become obsolete. There would be an end of 
 oaths, of jurats, of inquisition, and of perjury in 
 taxation. 
 
 This philosophy of freedom may not be apparent 
 at a glance. It does not appeal to the imagination 
 as does the philosophy of socialism. But those who 
 will apply the known laws of evolution to social and 
 industrial conditions and will study the development 
 of society in every new country where access to 
 
THE REMEDY PROPOSED 259 
 
 the land is open to all, or the history of the nations 
 of Europe down even to the present day, will find in 
 the freedom which would result from this proposal 
 a social philosophy as adequate to the problems of 
 to-day as any ever offered by the Utopian dreams of 
 the past. 
 
 Under this proposal the state would become the 
 universal rent collector. It would step into the 
 shoes of the ground landlord. There would be no 
 land rent. It would all be absorbed in taxes. In 
 other words, society would assume what society 
 itself had created, and in so doing, would leave free 
 from molestation all that the individual created. 
 There would be no other taxes and there would be 
 need of none. 
 
 When all of the rent was so appropriated the 
 land would be socialized. It would have no capital 
 or selling value. It would become the common 
 property of the nation, subject only to an annual 
 rental charge. With this established, the earth 
 would be opened up to use by all. Then opportunity 
 would call from every quarter. Then the demand 
 for labor would transcend the labor supply, and the 
 worker would be able to command the full product 
 of his toil. Then society would be free from the 
 burdensome taxes on consumption and exchange 
 which now impoverish it, while trade and commerce 
 would be free to follow their natural channels. 
 Then an era of freedom would arise the like of 
 
260 PRIVILEGE AND DEMOCRACY 
 
 which the world has never known, a freedom in which 
 no man could live by the sweat of another's face and 
 no man could levy tribute on his neighbor by law. 
 Then there would be equality of opportunity for all, 
 an equality in which the natural instincts of man 
 to justice and righteousness would have full play. 
 Then from each according to his privileges, and to 
 each according to his labor, would be the rule of life. 
 
 The city of New York could commence this reform 
 in all its essentials by a law of but few sentences in 
 length. It could socialize a large part of its three and 
 a half billions of land values by the abandonment 
 of all taxes now assessed against houses, buildings, 
 improvements, and personal property, by permitting 
 the whole burden of local taxation to fall upon 
 land values. All of the machinery for carrying this 
 programme into execution already exists. The city 
 now assesses its land at its full value and it assesses 
 it every year. It separates improvement values from 
 land values. New York as well as Boston has dem- 
 onstrated that land can be valued more easily and 
 far more accurately than any other form of wealth.* 
 
 With the tax on land values increased by the 
 
 'When the taxation of land values was first proposed it was urged 
 that the proposal was impractical, because it was impossible to value 
 land separately from improvements or to ascertain what was the 
 unearned increment. A dozen states and cities have demonstrated 
 that land can be easily and accurately valued, and the annual reports 
 of the assessing officers of New York and Boston have furnished 
 startling evidence of the colossal values which society has given to a 
 few of its members. 
 
THE REMEDY PROPOSED 261 
 
 abandonment of other taxes, ground rents would 
 fall. So would the value of the land. In time the 
 $200,000,000 of rent, now paid to a handful of 
 owners, would be paid to the community that created 
 it. As the taxes were increased the value of the 
 land would disappear. Ultimately it would become 
 in effect the property of the city. New York would 
 be the richest landlord in the world. By this simple 
 process it would have socialized one-half of the 
 wealth of the city. 
 
 Into its treasury there would flow an annjial 
 income of $250,000,000, instead of $160,000,000 as 
 it is to-day. For already forty per cent, of the 
 taxes of New York, or about $60,000,000, are taken 
 from rent. From out this increasing treasure a 
 city could be erected whose magnificence would 
 surpass anything the world has known. By means 
 of it the city could operate, without cost to the 
 consumer, the services of transit, light, heat, and 
 power, the owners of which services now share with 
 the owners of the land the unearned increment of 
 the city. The city could develop a traction policy 
 and distribute its population far out into the country- 
 side. A conscious housing and transportation policy 
 could be evolved, as far in advance of that which 
 private monopoly has given us as the ocean grey- 
 hound is in advance of the cattle-ship or the auto- 
 mobile is superior to the stage-coach. Light, heat, 
 and power could be supplied in the same way, at 
 
262 PRIVILEGE AND DEMOCRACY 
 
 no cost at all, were these services under public con- 
 trol as they should be. For these are the arteries 
 of municipal life. They are as essential a part of 
 the public body as the nervous system is a part 
 of the human body. Modern city life is impossible 
 without them. They can only be properly man- 
 aged when the idea of private profit is subordinate 
 to the idea of service. Even to-day public admin- 
 istration is more responsive to public opinion than 
 private administration. In time the common- 
 wealth will become far more intelligent than pri- 
 vate capital. This is already true wherever the 
 interest of privilege coincides with the interest of 
 the community. This superiority is apparent in 
 the magnificent docks which have been erected 
 about the city of New York, as well as in the splen- 
 did school-houses and libraries and public struct- 
 ures which adorn the metropolis. It is apparent 
 in the workmanship of river and harbor improve- 
 ments, in the construction of a great battle-ship, or 
 the building of the Panama Canal by the nation. 
 Wherever privilege desires efficiency the govern- 
 ment is efficient. And when the government is free 
 from the corrupting influence of big business, when 
 it turns its attention to the conscious aim of serving 
 democracy, we shall find that ability, talent, and 
 genius will serve the state far more ardently than 
 it ever served for private hire. 
 We need not wait for evidence of the fact. It 
 
THE REMEDY PROPOSED 263 
 
 may be seen in the high sense of honor and intelli- 
 gence of the War and Navy Departments, as well 
 as in the world of science, where men labor in the 
 service of truth for the most insignificant pay and 
 for scant recognition. We see it in our universi- 
 ties and our schools, even in the fire departments 
 of our cities, where, unnoticed and unrecorded, men 
 go willingly into the face of death merely for the 
 sake of protecting another man's property. 
 
 We have only begun to make use of government 
 as an industrial agency. We are only beginning to 
 see that private property must be subordinated to 
 humanity. On every hand it is apparent that the 
 activities of the government must be increased and 
 that they can be used for the service of the many, 
 just as they are now used for the service of the few. 
 Old political formulas are changing. The state is 
 rapidly becoming an economic as well as a political 
 agency. From now on this tendency must in- 
 crease at an accelerated pace. And the services 
 which the community could render its people, from 
 out the as yet untouched common treasure, would 
 of themselves relieve the most serious wants of 
 modern society. For poverty can be relieved by 
 increasing the free services of society as easily as 
 privilege can be created by the passage of tariff 
 laws, by railway privileges, and franchise grants. 
 It is only a question of the class in control of the 
 government and the motives which animate it. 
 
CHAPTER XXII 
 THE REMEDY CONSIDERED 
 
 This then is the proposal: That all of the revenues 
 of the government shall be raised from a tax upon 
 the value of the land; that all other forms of taxa- 
 tion shall be abandoned; that trade, industry, and 
 commerce shall be free from any interference by the 
 state, and the products of labor shall exchange with 
 each other without let or hindrance of any kind. 
 Here there shall be but one tax, and that shall be 
 levied upon the value of the land which society 
 itself has created, until all rent shall have been 
 taken by the people for their common use and enjoy- 
 ment. 
 
 Let us examine this proposal. Is it just? This 
 test must be met by any proposal of social read- 
 justment. For injustice can only be corrected by 
 justice. There is, of course, the political sanction of 
 salvs populi suprema est lex. Taxation has always 
 been used to promote a social policy. The tariff 
 and excise taxes have been imposed in the name of 
 national well-being. During the Civil War state 
 bank-notes were taxed out of existence in the interest 
 of a sounder banking policy. We have no hesita- 
 
 264 
 
THE REMEDY CONSIDERED 265 
 
 tion in destroying millions of dollars of property, 
 innocently invested in the brewery and distilling 
 business, in the name of social well-being. We have 
 discouraged the manufacture and sale of oleomarga- 
 rine in the interest of a class and at the expense 
 of those who consume. And the taxation of land 
 values may be justified by the same sanction of 
 the welfare of the state. Measured by the standard 
 of conventional political justice it is perfectly 
 just. 
 
 There is, however, a higher sanction, the sanction 
 of absolute justice. And absolute justice requires 
 that society shall protect its members in the enjoy- 
 ment of that which they produce. That is the first 
 obligation of government. But no such protection 
 is offered to those whose labor creates the increased 
 land values. The presence of each one of us upon 
 the earth creates a value which is appropriated by 
 another. Each individual is compelled to pay trib- 
 ute for that which is really his own. 
 
 And there is but one way by which this social 
 value can be retaken. And that is by taxation. 
 For this reason the taxation of land values is the 
 reverse of confiscation. It is exact justice. It re- 
 turns to society that which society produces, and 
 leaves free from taxation that which the individual 
 by his efforts creates. 
 
 This then is the natural source of revenue, as 
 providentially provided as the manna of heaven 
 
266 PRIVILEGE AND DEMOCRACY 
 
 was provided for the Hebrew people. It exists in 
 abundance for every social need. It increases with 
 the growing needs of society and the complexity of 
 modern life. 
 
 But the taxation of land values is least of all a 
 financial measure. That is but incidental to a 
 larger social ideal. It is not the revenues society 
 would receive, it is the wealth which would spring 
 into existence and its just distribution that is impor- 
 tant. We could well afford to throw all of the rent 
 of the land into the sea if that were the only means 
 by which industrial freedom could be secured. For 
 the taxation of land values will insure freedom, it 
 will create a society in which the production of 
 wealth will be greatly increased, while the share of 
 each will be justly determined. 
 
 Let us follow the effects of this shifting of the 
 whole burdens of taxation onto land values. Its 
 first effect would be to discourage land speculation. 
 The owner could no longer sit idly on his holdings 
 and wait for society to make them valuable. He 
 would have to put the land to its most productive 
 use or sell it to some one who would. There would 
 be an economic motive urging production rather 
 than idleness. With the tax increased to three, 
 four, or five per cent, this pressure would be in- 
 creased. And surely society owes nothing to him 
 who merely monopolizes that which all men want 
 and which all men must have to live. As the 
 
THE REMEDY CONSIDERED 267 
 
 present Chancellor of the Exchequer of England, 
 Mr. Lloyd George, said, in defence of the land-tax 
 clause of the British budget introduced in 1909: 
 "If the speculator wants to remain a dog in the 
 manger, he must pay for his manger." 
 
 Under such a pressure land would be forced into 
 the market. Owners would seek, tenants, occu- 
 piers, workers. Houses would be erected on vacant 
 building sites. Mines, quarries, and plantations 
 would be worked to their capacities. The land 
 would invite men instead of repelling them. Op- 
 portunity would spring up on every hand. 
 
 Land values would fall in consequence. The 
 competition of sellers would bring this about. In- 
 stead of men competing for land, the land would 
 compete for men. The present economic interest 
 of the speculator would be reversed. Another influ- 
 ence would accelerate the movement. A tax upon 
 the products of labor increases their cost. The tax 
 enters into the price. It is paid by the consumer. 
 A tax on land values, on the other hand, reduces the 
 cost of land. It is deducted from the rent. As 
 rent falls so does the price of land, for capital value 
 is but the reflection of earning power. Economists 
 are agreed that a tax on land values cannot be 
 shifted. It remains where it falls. It diminishes 
 rent. "A tax on rent," says Ricardo, "would affect 
 rent only; it would fall wholly on landlords, and 
 could not be shifted to any class of consumers. 
 
268 PRIVILEGE AND DEMOCRACY 
 
 The landlord could not raise rent." ' John Stuart 
 Mill testifies to the same thing. He says: "A tax 
 on rent falls wholly on the landlord. There are no 
 means by which he can shift the burden upon any 
 one else. ... A tax on rent, therefore, has no 
 effect other than its obvious one. It merely takes 
 so much from the landlord and transfers it to the 
 state." ^ A tax on land values is thus unlike any 
 other tax save those imposed on incomes and in- 
 heritances. It remains where it is originally placed. 
 It must be paid by the owner. The state becomes 
 a rent collector. To the extent of the tax, society 
 shares with the landlord in the ownership of the land. 
 
 And as the tax increases, rent diminishes. If a 
 piece of land is worth |1,000 free from taxation it is 
 because it produces $50 rent. If a tax of two per 
 cent, is imposed on the capital value, the state then 
 receives $20 and the landlord $30. The value of 
 the land would be reduced to $600 and the social- 
 ized capital value appropriated by the state would 
 amount to $400. That is what is meant by the 
 saying that "the selling price of land is its untaxed 
 value." Were the present land taxes of New York 
 city, amounting to $60,000,000, removed, land val- 
 ues would rise by $1,200,000,000 immediately. 
 
 Ultimately, with the tax increased to the amount 
 of the rental, land values would vanish. There 
 
 ' Principles of Political Economy, chap. 10. 
 2 Political Economy, book 5, chap. 3. 
 
THE REMEDY CONSIDERED 269 
 
 would be no rent left. The state would have appro- 
 priated it all. A piece of land on Broadway would 
 theoretically have no more selling value than a 
 piece of land in Kansas. It would pay more taxes. 
 That is all. People would have to pay a higher 
 annual tax for the privilege of using it. 
 
 With this achieved, the landlord would cease to be 
 a factor in distribution. His share would then go 
 to the state. Under such conditions the man who 
 wanted a building site would pay a tax of $50 a 
 year to the community instead of $1,000 capital 
 value to the owner. This would end his relation 
 to the state as well as to the landlord. There would 
 be no other taxes of any kind. Farm tenants would 
 become proprietors by the same process. Capi- 
 talists would be relieved of the prohibitive cost of 
 building sites. Great estates would be broken up, 
 and land monopoly would come to an end. Then 
 men would own land merely to use it; and they 
 would use it in its most productive way. 
 
 The single tax is not land nationalization. The 
 ownership of the land by the state is not contem- 
 plated. Nor is it suggested that we should return 
 to the village community, with its common owner- 
 ship of the land and its periodic distribution among 
 the members. Nor does the single tax involve 
 peasant proprietorship, such as prevails in France, 
 Denmark, Switzerland, and parts of Germany. It 
 does not involve common ownership or an agricult- 
 
270 PRIVILEGE AND DEMOCRACY 
 
 ural state at all. Neither does it propose to limit 
 the amount of land which an individual may hold 
 or to promote small holdings, such as have been 
 provided for by recent legislation in England and 
 Ireland. 
 
 Any such solution as these is a compromise with 
 the evil. Peasant proprietorship does not strike at 
 the root of the problem. It does not meet the real 
 evil, which is the private ownership of the earth. 
 Such a programme only increases the number of land- 
 lords. It makes no provision for the generations 
 which are to follow. Small holdings and peasant 
 proprietorship fail to recognize the right of the 
 whole people to the land. It is not the great estate, 
 it is the right of one man or of ten million men to 
 the private and exclusive ownership of the land, 
 which is wrong. 
 
 The state would not own the land. It would, 
 however, be the xmiversal rent collector. Neither 
 the title, the owner, nor the present methods of 
 transfer would be disturbed. True, it would make 
 but little difference to the present owner whether 
 the land itself or only its annual income is taken. 
 In either event the land would have no value for the 
 purpose of sale. It would be valuable only for use. 
 
 The single tax is an automatic reform. Its 
 motive is to insure economic opportunities for all 
 time. It opens up the earth to all. It endows 
 mankind to-day and to-morrow with its common 
 
THE REMEDY CONSIDERED 271 
 
 heritage. Under it residence sections could no longer 
 be used as cow pastures; they would be used for 
 human habitation. Suburban building lands would 
 be developed and cities would spread out over a 
 wide area in the country districts. The land would 
 be opened up for cultivation. It would be allotted 
 by the natural demands of agriculture. If it were 
 profitable to use it for market gardens, it would be 
 used for market gardens. If it were more profit- 
 able to farm it in large estates, it would be divided 
 into large estates. The law of demand and supply 
 would automatically determine the size of holdings. 
 But as the country increased in population and the 
 pressure of humanity increased the demand, its sub- 
 division would naturally follow. 
 
 Mineral resources would be opened up by the 
 same pressure. Their owners would be compelled 
 to use them or permit others to do so. Million-acre 
 estates in the West could no longer be used for 
 grazing purposes. The burden of taxation would 
 render it impossible. Monopoly would be destroyed 
 at its root. It would be destroyed by the simplest 
 of methods and the only method possible short of 
 ownership by the state. The pressure of self-interest 
 would lead to the opening up of the land and the 
 resources of nature to use, and to use in their most 
 productive way. 
 
 As we have seen, nearly all of the menacing 
 monopoUes are either identified with the land or are 
 
272 PRIVILEGE AND DEMOCRACY 
 
 connected with the railways or are made possible by 
 the protective tariff. The land monopolies are the 
 most complete and the most perfect. It is the 
 ownership of three-fourths of the iron ore in the 
 United States and the bulk of the coking coal that 
 makes the Steel Trust invincible. It cannot be 
 reached by competition, and regulation is impos- 
 sible. The same is true of the anthracite-coal mo- 
 nopoly, of the bituminous-coal, the oil, copper, lead^ 
 and natural-gas monopolies. It is the ownership of 
 limited sites of land that makes these monopolies so 
 easily consolidated and immune from every form of 
 attack. They, too, have been and are still aided by 
 the railways, and are safeguarded from foreign com- 
 petition by the tariff. 
 
 Railway discriminations and the tariff have made 
 possible the sugar, wool, leather, paper, lumber, 
 and other monopolies. They are the products of 
 class legislation. They are not the outcome of the 
 natural evolution of industry. Nor are they the 
 final flowering of the industrial process which began 
 with the steam-engine. They are not due to any 
 great skill on the part of their creators. They enjoy 
 no sanctity of superior ability. They are the prod- 
 ucts of class-made privileges. 
 
 These monopolies can be destroyed by the same 
 tools which created them. They can be destroyed 
 by the abolition of the tariff, the public ownership 
 of the railways, and the taxation of the natural 
 
THE REMEDY CONSIDERED 273 
 
 resources with which they are identified. The 
 owners of these Umited mineral sites could no longer 
 sit idly on the preserves which they have acquired 
 and limit the output. The resources would have 
 to be developed in order to meet the tax. A great 
 increase in production would take place. Compe- 
 tition would be re-established and prices would fall 
 in consequence. The domestic producer could not 
 prevent this by combination with the foreign manu- 
 facturer. The pressure in the rear would prevent 
 it. Raw materials would sell at their labor rather 
 than their scarcity cost, while the independent pro- 
 ducer would be placed on a footing of equality with 
 those who own the raw materials of production. 
 
 There are only two ways by which the economic 
 well-being of humanity can be improved. One is 
 by an increase in the amount of wealth. The other 
 through its more just distribution. Poverty can be 
 abolished in no other way. It is often assumed that 
 there is not enough wealth to go around. As we 
 have seen, however, the annual wealth produced in 
 America amounts to $1,170.20 for every family of 
 five, which is just about two and a half times the 
 average wage as ascertained by the census. There 
 is, therefore, wealth in abundance were it justly 
 distributed. 
 
 But the taxation of land values would increase 
 this production. It would also equitably distribute 
 it. Of this there can be no possible doubt. The 
 
274 PRIVILEGE AND DEMOCRACY 
 
 taxation of land values would affect not agriculture 
 alone, not mining alone, but all industry would 
 sympathetically respond to the stimulus which the 
 opening of the land would involve. Houses, fac- 
 tories, and improvements would be encouraged in 
 the cities and the country, while the stimulus of 
 self-interest would lead those who own more than 
 they «an profitably use, to dispose of their holdings 
 to those who would develop them. 
 
 This movement would be still further stimulated 
 by the exemption of all improvements, all ma- 
 chinery, all factories, and the products of labor from 
 taxation. Capital and labor would be encouraged, 
 not penalized. Capital now locked up in land 
 speculation would be forced into active business 
 enterprise, while the removal of the taxes upon all 
 sorts of consumable wealth would add a further 
 stimulus to industry and production. Persons of 
 small capital could engage in industry. They could 
 organize companies and acquire sites at little or no 
 cost. A revival of small industry would follow. It 
 would not require any aid from the state. It would 
 come from the voluntary action of the men them- 
 selves. The increase in wages, the cheapening in 
 the cost of land, the diminished cost of tools and 
 machinery would lead to the organization of co- 
 operative industries on a small scale. 
 
 But the great gain would come from the new light 
 of hope, of freedom, of industrial independence that 
 
THE REMEDY CONSIDERED 275 
 
 would brighten the eye of all. Then each man 
 could more readily choose his calling; he would 
 not be driven to accept the job that was nearest 
 at hand. A new country with new vistas would 
 always beckon to him just as it did to his fore- 
 fathers; but it would be a country in which all the 
 gains of civilization would serve him and his chil- 
 dren. The human mind can no more picture the 
 society which would result from the forcing of all 
 land into use, and its most productive use, than 
 the imagination of Watt could have foreseen the 
 changes which were to follow the discovery of 
 steam, or of Franklin the discovery of electricity. 
 In comparison with the effects of this revolution, all 
 other reforms for which we are now agitating would 
 be inconsequential. 
 
CHAPTER XXIII 
 THE NEW DISPENSATION 
 
 This stimulus to production would only achieve 
 this result if the increased wealth were properly dis- 
 tributed. How, it may be asked, would the farmer, 
 the wage-earner, and the great mass of humanity 
 be bettered by the change? 
 
 In the first place, the abolition of all indirect 
 Federal taxes would save the consumer $600,000,000 
 a year. It would free him from the monopoly prices 
 now exacted by reason of the tariff. For the tariff 
 has increased the cost of living and placed a burden 
 upon the consumers of America of from one and one- 
 half to two billion dollars a year. These indirect 
 taxes and monopoly charges are paid most largely 
 by the poor. For the consumption of sugar, to- 
 bacco, wool, cotton, fuel, oil, meat, and foodstuffs 
 is out of all proportion to the relative incomes of 
 the rich and the poor. 
 
 The tariff taxes are regressive taxes. They are 
 exaggerated poll taxes. They bear most heavily 
 on those least able to pay them. The abolition of 
 indirect taxes and monopoly charges would add 
 
 276 
 
THE NEW DISPENSATION 277 
 
 from $100 to $200 a year to the purchasing power 
 of each family. The price of commodities would 
 fall to this extent. But this is not all. The 
 abolition of all taxes upon houses, buildings, and 
 things which labor produces would still further 
 reduce the cost of living. It would cheapen the 
 cost of everything consumed. For taxes upon 
 labor products are shifted on from the producer to 
 the consumer until they are finally lodged with him 
 who buys. With these taxes abolished, prices would 
 still further fall. Money would buy more than it 
 does to-day. It would go further. All this would 
 elevate the standard of living. 
 
 Thus the well-being of the consuming class would 
 be improved. Then, too, the landlord would cease 
 to be a claimant in distribution. His share, which, 
 as we have seen, amounts to probably three billion 
 dollars a year, would pass to the community, leaving 
 only the capitalist and the worker to struggle for the 
 output. How would the taxation of land values 
 affect the relations of these claimants? How would 
 it insure to the worker the full product of his toil, 
 and to the capitalist only a fair return upon his in- 
 vestment? How, in other words, would the condi- 
 tion of him whose only capital is in his labor be 
 improved? 
 
 We can easily imagine the results which would 
 follow from some calamity of nature which di- 
 minished the population of the country by one- 
 
278 PRIVILEGE AND DEMOCRACY 
 
 half. The effect upon the distribution of wealth 
 would be immediate. The relations of classes 
 would be reversed. Mills and factories would be 
 short-handed. The mines and the countryside 
 would be denuded of labor. A clamor for workmen 
 would ensue. The farmer would compete with the 
 mill-owner. The railroads would struggle with the 
 mine-operator. The newspapers would be filled with 
 alluring advertisements of positions seeking men. 
 
 Wages would rise with great rapidity. They 
 would go up by leaps and bounds. The tramp and 
 vagrant class would disappear. So would soup 
 houses and the bread lines upon our streets. Vice 
 and crime would greatly diminish, and the inmates 
 of charitable and penal institutions would be reduced 
 to a diminishing point. The unemployed and de- 
 linquent classes would fill the vacuum. Those in- 
 dustries which were the least attractive would be 
 the last to be filled, for the wage-earner would be in 
 a position to choose his employment. For the time 
 being he would be the master of the situation. 
 There would be two jobs hunting for every man. 
 Under existing conditions there are more men 
 than jobs. And it is this that depresses wages. A 
 few men out of employment will disturb the equi- 
 librium of wages. They impair the standard of 
 living of their fellows. 
 
 With the supply of labor thus reduced, a new 
 relationship between capital and labor would arise. 
 
THE NEW DISPENSATION 279 
 
 Arrogance would give way to a kind of partnership. 
 The two agencies in production would come together 
 on terms of equality. A readjustment of all indus- 
 trial relations would take place. Men would not 
 need to sacrifice their lives in order to escape star- 
 vation. Safety appliances and compulsory insur- 
 ance would be provided as a matter of necessity. 
 Otherwise the employer could not keep his men. In 
 place of the struggle for a chance to labor, there 
 would be substituted a struggle on the part of 
 employers for men. 
 
 Such are some of the obvious results which would 
 follow such a decrease in population. History offers 
 a complete confirmation of this hypothesis. In the 
 fourteenth century the black plague swept over Eu- 
 rope. It appeared in England in 1348 and 1349, 
 and carried off one-third of the population in a few 
 years' time. The spirit of society was revolutionized 
 by it. A dearth of labor was created. Wages shot 
 up from two to three hundred per cent, in a few 
 years' time. The landlords were unable to work their 
 farms. They could not market their products. Ten- 
 ants deserted their holdings in order to participate 
 in the increased wages that were offered. In conse- 
 quence landlords reduced their rents, or relieved their 
 tenants from payment altogether. Many members 
 of the aristocracy were impoverished. This was 
 the golden age of British peasantry. They com- 
 manded the situation. 
 
280 PRIVILEGE AND DEMOCRACY 
 
 "It was both easy and profitable for a villein to 
 turn his back upon an unwise lord and escape to 
 another manor or to a town. Only in a very few 
 cases does it seem to have been possible to get 
 laborers, servants, or tenants under the old condi- 
 tions. The great point of complaint was the rise 
 in wages. In very many cases villeins were com- 
 pelled to take up vacant holdings. In others, the 
 lands were let on lease to free tenants. And, as the 
 supply of land was much greater than the demand 
 for it, villeins were able to compel the lords to con- 
 sent to the commutation of services. Moreover, it 
 appears that the rents paid were frequently lower 
 than before. Thus the black death resulted in an 
 increase of free tenements and a decrease of the lord's 
 income." ^ 
 
 The land-owners controlled Parliament. They 
 sought to check, by criminal laws, the increase in 
 wages and the abandonment of holdings by the serfs. 
 They enacted the Statute of Laborers, by which it 
 was provided that all workmen should accept the 
 same rate of wages that prevailed before the plague. 
 The penalties were severe. Imprisonment was de- 
 creed against any one who left his service before 
 the end of his term. But the act was of no avail. 
 It was re-enacted with increased penalties from time 
 to time. The landlords controlled the administra- 
 tion of the law. The peasantry was ignorant and 
 immobile. Yet fortified with all of the power of 
 
 ' History of the English AgricvUural Laborer, by Dr. W. Hasbach, 
 p. 22. 
 
THE NEW DISPENSATION 281 
 
 the government, the aristocracy was helpless before 
 the situation. The shortage in the labor market 
 reduced rent and increased wages. The advantage 
 was all with the laborer and the tenant. This con- 
 dition continued for nearly two centuries, until 
 population again began to press upon the land. 
 This is the opinion of all those who have studied 
 this period of English history. "I have stated more 
 than once," says Professor J. E. Thorold Rogers, 
 "that the fifteenth century and the first quarter of 
 the sixteenth were the golden age of the EngUsh 
 laborer." ^ 
 
 That the results described would follow a sudden 
 reduction in population is obvious. It could not be 
 otherwise. And the condition of labor would con- 
 tinue to improve until population again filled in the 
 vacuum. 
 
 Let us reverse this picture. The taxation of land 
 values would be a permanent black plague to land 
 monopoly. It would not diminish the number of 
 wage-earners. It would increase the demand for 
 labor. This increase in the demand would have the 
 same effect upon wages as the decrease in the supply. 
 All of the land in the country would seek tenants 
 and workers. Mines would have to be operated to 
 meet the burdens of taxation. So would city sites. 
 So would farms. Almost immediately men would 
 be masters of the situation. They would be able 
 
 > Work and Wages, p. 326. 
 
282 PRIVILEGE AND DEMOCRACY 
 
 to choose their employment. They would be free 
 from the pressure of hunger which forces them into 
 the first opportunity which offers. Hope would 
 take the place of despondency, for there would be 
 opportunity to work where one willed. Then the 
 land would serve the people instead of humanity 
 serving the landlord. The wage-worker would find 
 his nominal wages greatly increased, and the price 
 of all the necessities of life correspondingly dimin- 
 ished. For wealth would be created in greater 
 abundance. 
 
 But the opening up of the resources of the earth 
 by taxation would do far more than the reduction 
 in the number of laborers. For loss of population 
 means a loss in the productive as well as the con- 
 suming power of society. Increasing opportunity, 
 on the other hand, involves an increase in the per 
 capita production of wealth. The division of labor 
 which has taken place has increased the per capita 
 production. The labor of a single man produces 
 to-day three hundred watches, where a generation 
 ago it produced at most a hundred. The skilled 
 workman at a machine turns out three hundred 
 pairs of shoes, where the cobbler at the bench pro- 
 duced at the most a score. Where the housewife 
 at the loom was able to clothe only her family, now 
 a child at the machine will produce cloth for a him- 
 dred families. The division of labor has so in- 
 creased the productivity of the worker, that poverty 
 
THE NEW DISPENSATION 283 
 
 should have long since disappeared from the face 
 of the earth. And this increase in productive power 
 would go to the producing classes were it not in- 
 tercepted by some maladjustment of the laws of 
 distribution. This maladjustment would disappear 
 with the opening up of the resources of the earth, 
 for the increase in the opportunities for labor would 
 place the producing class at such an advantage that 
 they would be able to appropriate to themselves 
 aU of the products of their labor. 
 
 The taxation of land values would do this. It 
 would affect the labor market just as did the black 
 plague or the discovery of a new continent. Labor 
 would be the predominant partner in the wage 
 agreement. No statute of laborers or combination 
 of capitalists could affect this situation. Through 
 the forcing of the land into use, and its most pro- 
 ductive use, and the full taxation of rental values, 
 rent would vanish and the wealth of the world would 
 be distributed between labor and capital. 
 
 A few short years would usher in such prosperity 
 as the world has never seen. Involuntary poverty 
 would disappear. Opportunity would call upon tal- 
 ent. There would be no limits to the demand for 
 labor. The benignant laws of freedom would sup- 
 plant the ignorant laws of man. Competition for 
 men would arise where now there is none. Initia- 
 tive and talent would enjoy an opportunity to ex- 
 press themselves. Men would not be limited to the 
 
284 PRIVILEGE AND DEMOCRACY 
 
 single job which they must now accept or starve. 
 They would be free to labor at that which was most 
 congenial, and at that which was consequently the 
 most productive. Then labor and capital would be 
 free from all taxes. There would be no barriers to 
 trade, no tribute on wealth. Only the landlord 
 would disappear as a claimant in distribution. He 
 now performs no useful service. He would then re- 
 ceive no compensation. Rent would flow to society, 
 and society in turn would be divided into two 
 claimants, labor and capital, and they would meet 
 in the struggle for the division, just as they now 
 meet in every new country where the worker is free 
 to choose whether he will work for himself or for 
 another. And the experience of all new countries, 
 where land is free, demonstrates that labor is then 
 the dominant partner in distribution. 
 
 It may be urged that such an increase in wages 
 would endanger industry. The reverse would be 
 true. It would destroy monopoly and imperil those 
 combinations which are identified with the land. It 
 would usher in competition and stimulate innumer- 
 able new industries. But prosperity does not con- 
 sist in the inflated dividends of the Steel Trust or 
 the watered securities of the railroads; it does not 
 consist in crowded New York hotels or summer 
 resorts. Prosperity should consist in twenty mill- 
 ion famiUes whose wages or incomes enabled them 
 to Uve in comfort and happiness. It is they who 
 
THE NEW DISPENSATION 285 
 
 form the market. It is they who consume the out- 
 put of mill and of factory. Only a small portion of 
 the wealth that is produced is consumed by the priv- 
 ileged classes. And were the income of America's 
 working population doubled to-morrow, there would 
 be ushered in an era of prosperity which would 
 flood the factories with orders and bring to the 
 docks of New York the surplus products of other 
 lands. For the wants of man know no limit. 
 Our eighty millions of people can consume many 
 times what they do to-day and still many legitimate 
 wants would remain unsatisfied. 
 
 The taxation of land values would awaken indus- 
 try all along the line. It would give an impetus to 
 the building of homes and factories. Agriculture 
 and mining would be awakened in the same manner. 
 Those who produced the raw materials would con- 
 sume the finished product. And they in turn would 
 call upon the farmer and the miner for the raw ma- 
 terials. With increasing wages there would be in- 
 creasing demand for goods. This would ordinarily 
 increase prices. But the abolition of rent and the 
 opening up of all nature to production, as well as 
 the abolition of all taxes upon labor and industry, 
 would reduce prices to their labor cost. 
 
 Thus the taxation of land values is a social 
 philosophy — a philosophy as adequate as socialism 
 itself. It would destroy monopoly and exalt the 
 claims of humanity above the claims of privilege. 
 
286 PRIVILEGE AND DEMOCRACY 
 
 It would return the land to the community and 
 retain it for the community for all time. Then dis- 
 tribution would give to each according to his labor, 
 and society would take from each according to the 
 privilege which he enjoyed. Then there woxild arise 
 an era of freedom in every walk of life. 
 
CHAPTER XXIV 
 THE OPEN DOOR AND THE OPEN HIGHWAY 
 
 Thus the taxation of land values is a social 
 philosophy, a philosophy of freedom, of industrial 
 liberty in all the relations of life. The single tax 
 involves the abolition of the protective tariff and 
 the vexatious interference with trade and industry 
 which now strangles the production and exchange 
 of wealth. It is not a natural system of taxation 
 alone, it is a natural system of industrial and social 
 relations. 
 
 We have seen that the abolition of the system of 
 indirect taxes would save the consumers about 
 $600,000,000 a year in taxes, which are all paid by 
 labor, in some form or other. It would also save 
 them from the indirect costs of the system, which 
 amount to from one and a half to two billion dollars 
 a year more. America would then become the 
 cheapest place in the world in which to live. It is 
 now one of the most expensive, possibly the most 
 expensive. The bottom would be knocked out of the 
 great monopolies which are mothered by the tariff. 
 
 But the gain would not end here. Not only 
 would the people have that much more to spend 
 
 287 
 
288 PRIVILEGE AND DEMOCRACY 
 
 for the things they desire; not only would two 
 billion dollars be added to the purchasing power of 
 the country; not only would the wheels of industry 
 be set in motion to satisfy these increased wants; 
 but trade and industry would be awakened in a 
 thousand unknown fields by the freedom of trade 
 which would follow. We have no means of telling 
 what industries are rendered impossible by the 
 tariff, or the new industries which would spring up 
 by reason of its abolition. But the coming of lib- 
 erty has always been followed by a great industrial 
 awakening. For commerce hates barriers. It in- 
 stinctively follows the lines of least resistance. For 
 every industry that is helped by the tariff, probably 
 two are rendered impossible by it. The freedom of 
 trade between the states of the American Union 
 proves this. So does the awakening which followed 
 the abolition of the corn laws in Great Britain in 
 1846. Industries which had been languishing for 
 years awakened into life. The commerce of Eng- 
 land assumed command of the seas. Her iron, steel, 
 wool, and cotton factories took the world by storm. 
 Were the trade of America free to follow its natural 
 channels, our exports would command the markets 
 of the world. America is the cheapest of producers. 
 This is true in almost every line of industry. We 
 have the most abundant raw materials, the most 
 highly skilled labor, the highest per capita invest- 
 ment of capital. Were the barriers of trade removed 
 
THE OPEN DOOR 289 
 
 the commerce of the world would be ours in a few 
 years' time. 
 
 These are the by-products of the single tax. 
 Freedom of trade is but part of freedom in every 
 relation of life. And freedom is no less the natural 
 than the scientific law of progress. 
 
 There is yet another corollary to the taxation of 
 land values. And that is the free, open highway. 
 There are certain services so fundamental to our life 
 that they cannot with safety be left in private 
 hands. We do not question this as to the activities 
 already assumed by the state. No one thinks of 
 turning back the schools, libraries, parks, and post- 
 office to private hands. Even the most reactionary 
 is in favor of the free, open public highway. Yet 
 the highways were in private hands up to very 
 recently. The private toll road is still to be found 
 in some parts of the country. But it has very gen- 
 erally disappeared before the necessities of modern 
 life. And the railway is but a highway, a highway 
 really far more important than the streets of our 
 cities. Through it the life of the nation circulates. 
 All industry is dependent upon its proper adminis- 
 tration. It not only fixes the wages of ten per cent, 
 of our workers, it vitally affects all industry and the 
 well-being of all people. Upon its favors and dis- 
 criminations, discriminations that the ingenuity of 
 the government and the skill of the secret-service 
 agent cannot trace, many of the most menacing 
 
290 PRIVILEGE AND DEMOCRACY 
 
 monopolies are reared. The price which is paid for 
 beef on the hoof, for sheep on the range, for the farm 
 products of the West is determined by the railways, 
 the packers, the elevators, and the. warehousemen, 
 whose alliance with the railways is no longer a mat- 
 ter of doubt. Eggs, butter, and dairy products, 
 as well as the fruits of California and Florida, are 
 under the control of these agencies, which fix the 
 price the farmer receives as well as the price which 
 the consumer pays. The cost of living of the entire 
 nation is in a large measure controlled by those who 
 own these agencies. 
 
 Even were the railways open to all on equal 
 terms, even were they to abandon their coal lands, 
 to dissolve their connection with private industry, 
 and free themselves from the suspicion which now 
 attaches to them, they should not be entrusted to 
 the caprices of private management and control. For 
 the function which the railways perform is a public 
 one — they enjoy a part of the sovereignty of the 
 state. That the railways should be owned by the 
 people has been recognized by almost every civihzed 
 nation save Great Britain and America. These 
 nations alone have trusted to private capital. Eng- 
 lish industry is suffering in consequence, while the 
 politics of America have been corrupted to the core 
 and her industry reduced to monopoly in every great 
 necessity of life. 
 
 There is only one rule of private railway manage- 
 
THE OPEN DOOR 291 
 
 ment, and that is charging all that the traffic will 
 bear. This is the solemn duty of those intrusted 
 with the administration of the property. They are 
 bound to make as much profit as possible. The 
 railway president may be the most humane of 
 men or the most far-seeing of social reformers. 
 He would be no more justified in adopting any 
 other rule of management, than the agent of the 
 Astor estate would be justified in accepting any 
 other rental than that which the public would 
 pay. 
 
 A railway president cannot serve the public and 
 his stockholders. Their interests are diverse. It 
 is his duty to make dividends. To do this, he must 
 adopt whatever means are necessary to secure the 
 traffic. And it is not possible for any commission 
 to trace the subterranean methods which may be 
 devised in the granting of rebates, discriminations, 
 or favors. The motive of railway management 
 should be service, not profits. This is impossible 
 so long as the railways are in private hands. 
 
 There is still another reason for the public owner- 
 ship of the highways. Railway values, as we have 
 seen, are land values. Earnings respond to the 
 same influences as rent. Inflated railway capitali- 
 zation is an unearned increment. The earnings 
 of the railways of the country increased from 
 $1,222,089,773 in 1897 to $2,346,600,000 ten years 
 later, or an increase of nearly one hundred per cent. 
 
292 PRIVILEGE AND DEMOCRACY 
 
 During the same period capitalization grew from 
 $10,635,008,074 to $16,082,146,683. The develop- 
 ment of the country, the growth of industry, the 
 coming of immigration, all these have added to the 
 tribute which those who own the highways have 
 been able to extract from the labor and industry of 
 the country. Every exertion of society adds to 
 the value of these properties, just as it adds to the 
 value of a corner lot in a great city. 
 
 It is true this social value can be retaken by 
 taxation just as can land values proper. And 
 many persons believe that the railway problem can 
 be solved through this means. But this would not 
 put an end to corruption. It would not check the 
 waste which is everywhere apparent in railway 
 management. It would not remove the antagonism 
 between the private interest and the public welfare, 
 which is the greatest evil of the private ownership 
 of a public function. 
 
 The public ownership of railways would do more 
 to free our life from privilege and corruption than 
 any other reform. In commonwealth after com- 
 monwealth politics are in the hands of the feudal- 
 like interests, which, like the aristocracy of Great 
 Britain prior to the reform act of 1832, fill the 
 offices of the state and the nation with their own 
 retainers. They control primaries and conventions, 
 they send their attorneys, doctors, and agents to 
 State assembhes. At their dictation United States 
 
THE OPEN DOOR 293 
 
 senators are elected, who, in many instances, are 
 their paid attorneys and representatives. 
 
 The class warfare is bound to continue so long 
 as a powerful interest controls one-sixth of the 
 wealth of the nation; an interest which ramifies 
 into every precinct in the land and which openly 
 avows that it is necessaiy to corrupt the govern- 
 ment in order to protect what it claims as its own. 
 Nor can industry be free or labor receive the fruits 
 of its toil, so long as it Hes in the hands of what is 
 in effect an arbitrary tax-gatherer, to intercept so 
 much of the wealth produced as suits its fancy. 
 
CHAPTER XXV 
 THE DEMOCRACY OF TO-MORROV/ 
 
 We are beginning to see that democracy is some- 
 thing more than the freedom to speak, to write, to 
 worship as one wills, to be faced with one's accusers, 
 and to be tried by one's peers; it involves far more 
 than the absence of absolute government or the 
 tyranny of an hereditary caste. The right of par- 
 ticipation in the government, irrespective of birth, 
 race, and creed, and the substitution of manhood 
 suffrage and democratic forms for monarchical insti- 
 tutions, do not of themselves constitute democracy, 
 immeasurably valuable as these achievements are. 
 
 Democracy, too, involves far more than a system 
 of taxation that is ethically just; it involves far 
 more than the right to trade where one wills, un- 
 restrained by tariff laws; it involves far more than 
 the taking by the community of the wealth that the 
 community creates or the ownership by the people 
 of the highways, so essential to the common life. 
 These fundamental changes in the relation of man- 
 kind to its environment do not constitute an end 
 in themselves, any more than does the right of the 
 ballot or of participation in the government. All 
 
 294 
 
THE DEMOCRACY OF TO-MORROW 295 
 
 t]iese4hings_are but means to an end, and that end 
 is industrial freedom, a freedom as full and as free 
 to the poor as to the rich, to the next generation 
 and the generations which follow as it was to the 
 generations which spread themselves out upon an 
 unappropriated continent. Freedom is an indus- 
 trial far more than a political condition. 
 
 Unfortunately the idea of freedom suggests 
 license when demanded for all, just as it involves 
 license when enjoyed by the few. Privilege in- 
 vokes the beneficence of freedom when it would 
 stay the hand of the state in any attempt to control 
 its excesses, just as it invokes the perils of freedom 
 when it would be protected from its consequences. 
 Privilege protests in the name of freedom against 
 regulation of the railways or the franchise corpora- 
 tions, or the protection by law of children, women 
 workers, and those engaged in hazardous pursuits. 
 It attacks the labor union, the closed shop, and the 
 eight-hour day as subversive of personal liberty, 
 but invokes another argument for protection from 
 foreign competition or the right to monopoly com- 
 binations. 
 
 The political economist as well as the socialist 
 has confounded the evils of the present industrial 
 system with freedom. Laissez faire is credited with 
 the tenement, the sweat-shop, and the excesses of 
 capitalism. But freedom, even the laissez faire of 
 Quesnay, Turgot, Dupont de Nemours, and the 
 
296 PRIVILEGE AND DEMOCRACY 
 
 brilliant school of thinkers who laid the foundation 
 for the abolition of the feudal system and the op- 
 pressive restraints of mercantilism, is a far different 
 thing from the travesty of industrial liberty which 
 has masqueraded for nearly a century under that 
 name. For nowhere has there been freedom, the 
 freedom of access by humanity to the source of all 
 life. The land and the resources of nature have 
 been locked up with title-deeds of private owner- 
 ship, and mankind has been forced to content itself 
 with such opportunities as privilege offered. True 
 freedom, true laissez faire, involves the shattering 
 of all these chains with which labor is bound, and 
 the opening up of the earth to the free play of in- 
 dividual talent. It involves, too, freedom of trade 
 and the free public highway. This is the philoso- 
 phy of freedom. 
 
 Freedom is the law to which all life responds. 
 Freedom underlies the philosophy of evolution, 
 which all science has approved. Through freedom 
 all animate life has progressed; to its call the cave 
 man of the stone age has advanced by slow and 
 tortuous processes up to the civilized type of to-day. 
 But the application of this principle to human 
 society has been hmited to the formulation of the 
 law of the struggle for existence, with the medium 
 of that struggle ignored. 
 
 And freedom is the law of conscious as well as of 
 unconscious evolution, of historic as well as of pre- 
 
THE DEMOCRACY OF TO-MORROW 297 
 
 historic ages. From the very beginnings of organ- 
 ized society the progress of man has been in almost 
 direct ratio to his liberty. This is written across 
 the face of history from the time of the Grecian 
 city-states down to the latest experiment in nation- 
 building in the distant Pacific. It was economic 
 freedom that enabled the Roman people to bring 
 all Italy to their feet. It was the home-owning 
 soldier who carried Roman arms all over Italy. It 
 was economic freedom that spread the republic 
 over the face of Europe and gave to Rome the 
 supremacy of the world. It was the same economic 
 liberty which awakened the Renaissance and re- 
 suscitated commerce in the towns of Italy and 
 Germany during the Middle Ages. It was freedom 
 to make and to trade which builded the congeries 
 of free cities from the Adriatic to the mouth of the 
 Rhine, and called into life the civilization which 
 had been buried in the East for centuries. It was 
 this sort of freedom which gave eminence to Venice, 
 to Florence, to Genoa, to the Netherlands, an emi- 
 nence which was later seized by Great Britain when 
 she broke free from the restraints imposed by the 
 feudal classes on trade, industry, and commerce. 
 
 Wherever restrictive laws have been abolished, 
 wherever the rock of economic privilege has been 
 smitten with the touch of liberty, wealth has gushed 
 forth as it never did before. New processes, new 
 ideas, new inventions are awakened by the call of 
 
298 PRIVILEGE AND DEMOCRACY 
 
 freedom, whether it be the opportunity to produce 
 as one wills, to trade as one wills, or, far more 
 important, to make use of the earth free from the 
 dead hand of speculation. 
 
 Two great nations have in different ways and at 
 different times shaken themselves free from the 
 chains of privilege. They broke but the obvious 
 chains which bound them, it is true, but the effect 
 was electrical on the production and distribution of 
 wealth. When the States General was convened in 
 1789, France was entwined with as many laws as 
 the threads which bound Gulliver. There was no 
 freedom of thought, no freedom of action, no free- 
 dom of trade or commerce even within the kingdom. 
 No one could labor at a trade or calling without 
 being admitted to a closed corporation. No one 
 could manufacture anything or plant anjrthing ex- 
 cept according to rules laid down by the state. The 
 state regulated everything. The individual could 
 originate nothing. Even the kind of tools to be 
 used was prescribed, as were the width and quality 
 of cloth. Every product which did not conform to 
 rule was confiscated or burned. Individuals could 
 not sell or buy, except on permission of the state. 
 Exports of grain, even to the next province, were 
 prohibited. Agriculture bore every burden the 
 seigneurs or their agents could devise. The peas- 
 ant paid a rack-rent to the lord as well as all the 
 taxes to the state. He had to work on the estate of 
 
THE DEMOCRACY OF TO-MORROW 299 
 
 the lord and keep the roads in repair. His lands 
 were shot over, and devastated by game. He had to 
 grind his grain at the mill of the lord and press out his 
 wine at the lord's press. Most of the taxes were paid 
 by the poor, while the administration of justice was in 
 the hands of the privileged class. All life, all nov- 
 elty, all liberty of thought or action was suppressed. 
 On the night of August 4, 1789, the National 
 Assembly entirely destroyed the feudal regime. So- 
 ciety received a new birth. It was purged, as is 
 man by disease or a base metal by fire. The face of 
 France was swept of a thousand abuses, as the face 
 of the prairie is swept by flame. Man and the land 
 were left naked of countless privileges. The worker 
 was free to produce, to buy, to sell, and to exchange. 
 What his mind and hand produced remained in 
 great measure his own. There remained neither 
 nobility nor peerage, nor hereditary distinction, nor 
 distinctive orders, nor feudal regime, nor any other 
 superiority except that of public officials in the 
 exercise of their function. Better than all that, 
 there remained to no Frenchman any privilege or 
 exception to the rights which are common to all 
 Frenchmen. Farming of taxes was later aboUshed. 
 The domains of the clergy were assumed by the 
 state. There was a redistribution of taxes. There 
 was freedom in production and exchange. The old 
 regime was destroyed. The foundations of liberty 
 were laid for all the world. 
 
300 PRIVILEGE AND DEMOCRACY 
 
 Within the next few years industry, talent, and 
 genius sprang into action. From the farm and 
 the town the armies of France were recruited in 
 the name of liberty. For the first time in their 
 history the people were conscious that the nation 
 meant something to them. The army of France 
 became invincible. The peasant and the artisan, 
 enfranchised from the multitude of vexatious inter- 
 ferences which had controlled every act of their 
 lives, turned to their work with a new light in 
 their eyes and a new hope in their heart. It was 
 the night of August 4, 1789, and "The Self-Denying 
 Ordinance" that made the revolution permanent. 
 It was this that sent its blessings into every corner 
 of Europe, and brought forth in Germany the reforms 
 of Stein and Hardenberg. 
 
 A half century later England opened her ports 
 to the commerce of the world. She did not destroy 
 the abuses of the feudal regime. Very many of 
 these abuses still remain. But she abohshed the 
 corn laws imposed by the landlords in control of 
 ParUament for the protection of their rents. The 
 increase in production which followed surpassed the 
 expectations of Cobden and Bright. England was 
 converted into a vast industrial establishment. She 
 became the clearing-house of the world. Her ex- 
 ports increased from $288,934,380 in 1846 (the year 
 of the repeal) to $356,795,920 in 1850. In 1853 
 they were $494,668,905, and in 1857 $610,000,000. 
 
THE DEMOCRACY OF TO-MORROW 301 
 
 Freedom of trade revolutionized Great Britain. 
 It was a revolution which benefited chiefly a 
 limited class. Free trade did not destroy poverty. 
 It did not relieve the agricultural worker, nor did 
 it find decent homes for the tenement dweller. 
 Free trade did benefit the manufacturer and the 
 trader. It increased the value of the land of the 
 United Kingdom by calling into existence great 
 cities and towns wherein four-fifths of the popula- 
 tion now dwell. It was freedom, the freedom to 
 buy and sell, unrestrained by artificial barriers 
 erected by legislation, that explained the immedi- 
 ate ascendancy of the British people in industry. 
 Colossal as were these benefits of freedom, they are 
 inconsequential in comparison with those which 
 would follow from the freeing of the land as well. 
 
 And it was economic freedom that made America 
 what she is. It was this that lies at the foundation 
 of our democracy. It was not the Declaration of 
 Independence, it was not the Federal Constitution, 
 it was not the freedom from an established church 
 or hereditary privilege, it was not even the ballot; 
 it was freedom of access to the eartli and all its 
 fulness, it was the free land that explained our 
 institutions, it was this that gave us industrial 
 eminence. The things we hold most dear are but 
 the reflections of the relations of the American 
 people to the land. And it is the passing of this 
 freedom, it is the enclosure of the land and the 
 
302 PRIVILEGE AND DEMOCRACY 
 
 coming of the tenant, it is the monopoly of that 
 which is the source of all life, that has brought 
 down the curse of poverty upon us, just as it did 
 in Rome, just as it did in France, just as it did in 
 Ireland, and just as it did in England at a later day. 
 The remedy herein proposed will restore the 
 foundations upon which democracy is laid. It will 
 insure liberty for all time. It will insure equality 
 of opportunity in every walk of life and will guar- 
 antee to the worker all that his genius, his talent, 
 or his labor produces. The open door, the open 
 highway, and the socialization of the land will 
 destroy the tribute now exacted by monopoly. It 
 will usher in a social order in which men will be as 
 free from the fear of want as they are from want 
 itself. Then men will look forward not to diminish- 
 ing, but to increasing opportunities, for freedom will 
 not only continuously augment the wealth of the 
 world, it will insure its just distribution to those 
 who produce it. 
 
APPENDIX I 
 
 LAND VALUES IN THE UNITED STATES 
 
 In 1900 the census enumerators endeavored to get at 
 land and improvement values. They secured reports as 
 to land values in the case of farms and factories. For 
 the farms of continental United States it appears that the 
 land and improvement values, exclusive of the buildings, 
 amounted to 78.6 per cent, of the total, while the land 
 values of factories was 41.5 per cent, of the total. The 
 Commissioners of Taxes and Assessments of the city of 
 New York, where the land and improvements are sepa- 
 rately valued, place the pure land values at 63.2 per cent, 
 of the total. The land values of the city of Boston are 
 60.7 per cent., while Detroit and Milwaukee place the 
 pure land values at 53.9 per cent, and 55.5 per cent., 
 respectively. Thomas G. Shearman, a conservative stat- 
 istician, placed land values at 60 per cent, of the total, 
 taking the country as a whole, and estimated the pure 
 land values of the country at $27,600,000,000 in 1890. 
 (Natural Taxation, p. 140.) This was nineteen years 
 ago. During the intervening years land values have 
 increased far more rapidly than at any previous period 
 in the history of the country. We have seen that there 
 was an increase in the value of farm lands alone of 
 $6,000,000,000 in five years' time. Since 1890, too, the 
 mineral resources and railways have been monopolized, 
 and their values have increased enormously. 
 
 303 
 
304 APPENDIX I 
 
 In New York City the land and special franchise 
 values averaged $955 per capita in 1909, while in some 
 of the Western States, where assessments are of any value, 
 a similar per capita value seems to prevail. For these 
 reasons it would seem clear that $40,000,000,000 of land 
 values was a very conservative estimate in 1904. There 
 is every reason to believe that they amount to $60,000,- 
 000,000 at the present time. This is the estimate of Mr. 
 John Moody, the editor of a number of Wall Street pub- 
 lications, who says: 
 
 "I have stated that the estimated wealth of the nation 
 is to-day about $120,000,000,000. Of this, about one-half 
 or $60,000,000,000 is what might be called created wealth, 
 and the balance is spontaneous or unearned wealth — 
 what is sometimes called the 'unearned increment.' . . . 
 Let me try to show a little more clearly what I mean by 
 these different kinds of wealth. Take one of the large 
 transportation trusts as an example, the Union Pacific 
 Railroad system. Eight years ago its capital (market) 
 value was approximately $130,000,000, and this repre- 
 sented chiefly the real, tangible, created property at that 
 time. Since then, less than $150,000,000 more has been 
 invested in the Union Pacific Railroad, and yet the market 
 value of its securities to-day is not $230,000,000, as you 
 would naturally suppose, but is over $600,000,000. The 
 Pennsylvania Railroad system fifteen years ago was 
 worth $1,500,000,000; to-day it is worth over $2,500,- 
 000,000; the Reading system in 1896 was worth about 
 $120,000,000; to-day it is worth $600,000,000. The 
 Great Northern Railroad in 1890 was worth only about 
 $40,000,000; to-day it is worth over $500,000,000. The 
 public utility corporations of New York City cost to con- 
 struct less than $200,000,000, and yet to-day they are 
 capitalized for over $1,000,000,000. The Standard Oil 
 Company represents an original investment of far less 
 than $50,000,000, and yet it is worth in the markets to-day 
 
LAND VALUES 305 
 
 nearly $600,000,000. The great Steel Trust has actually 
 cost only $400,000,000, and yet it is worth nearly 
 $1,500,000,000. 
 
 "The difference between the cost of these things and 
 the market value represents the unearned increment, or 
 capitalized value, of their monopoly or special privileges. 
 This increment, created, of course, by the community, 
 the growth of population and general increase of produced 
 wealth, has, as the country has grown, increased with it, 
 and will necessarily continue to do so." ' 
 
 1 "The Evolution of the Trust," by John Moody, The Arena, for 
 May, 1907, p. 479. 
 
APPENDIX II 
 THE SUFFICIENCY OF THE LAND VALUES TAX 
 
 Is a land values tax adequate for the needs of the nation, 
 the States, and the local authorities? Thinking only of 
 farming lands, many people assume that it is not; they 
 believe that it is necessary for the government to disguise 
 its sources of revenue in order to secure sufficient funds 
 to maintain the state. 
 
 It is not in the rural districts that land values are 
 greatest. The land values of New York City alone are 
 equivalent to the values of 100,000,000 acres of ordinary 
 farming land. The land values of all our cities are equal 
 to the value of one-half of the land under cultivation in 
 the United States. And this does not include the colossal 
 values of the mineral resources, of the railways and the 
 transportation agencies. Land values are a far different 
 thing from land, and the taxation of land values is a far 
 different proposal than the taxation of land. 
 
 We can readily see the sufficiency of the tax proposed 
 from a consideration of the values already existing. The 
 total revenues collected by all of the agencies of the 
 government in 1902 amounted to $1,709,136,540.* Of 
 this sum, $670,789,517 was collected by the Federal Gov- 
 ernment, and $1,038,347,023 by the States, counties, cities, 
 and local divisions. Most of the local revenues came from 
 the general property tax on land and improvements, and 
 
 ■ Census Bulletin, "Wealth, Debt and Taxation," p. 963. 
 306 
 
THE LAND VALUES TAX 307 
 
 at least one-half of the revenues came from land. So 
 that if we deduct the taxes already collected from land 
 values, it leaves the sum of but $519,173,511 to be shifted 
 to that source for local purposes, as well as $670,789,517 
 of Federal revenues now collected by consumption taxes 
 through the customs and internal revenue systems. 
 
 As we have seen, the pure land values of the country 
 are at least $35,000,000,000. They undoubtedly amount 
 to twice that sum. But even if we assume the former 
 figure, the annual economic rent, measured at five per 
 cent., amounts to $1,750,000,000. It is probably nearer 
 $3,000,000,000. As we have seen, the total revenues to 
 be shifted from indirect taxes and improvements amount 
 to but $1,189,963,028, which, assessed against the rent, or 
 land values, would still leave over half a billion dollars in 
 the hands of the land-owners. 
 
 We can see the adequacy of the land values tax in some 
 great city where the land is valued separately from the 
 improvements, and is valued with some degree of accuracy 
 as it is in New York and Boston. The untaxed land values 
 of the former city amount to nearly $4,000,000,000. 
 The annual rent from the land alone equals $200,000,000. 
 All of the needs of this most extravagant city could be 
 assessed against this fund, and leave untouched for 
 Federal, State, and other purposes the sum of $100,000,000 
 a year.* 
 
 > The total revenues of New York amount to about 8170,000,000 
 a year. The city's proportion of the State tax amounts to about 
 $25,000,000. The proportionate part of the Federal revenues 
 which should be assigned to the city is about $30,000,000. If all 
 these revenues were collected from the rent of the land of the me- 
 tropolis, there would still be left for the land-owners something like 
 $30,000,000 a year. For already $60,000,000 is being taken from 
 the land each year under existing taxes for local purposes. 
 
308 APPENDIX II 
 
 The speculative growth in land values is enough in 
 itself to meet the needs of almost any growing city. Thus 
 in New York the growth in the value of the land, as shown 
 by the annual reports of the Commissioners of Taxes and 
 Assessments for the years 1904 to 1908, amounted to 
 $786,004,347. This is equivalent to $196,501,086 a year, 
 or $26,501,086 more than the revenues of the city. The 
 same thing is true of Boston, Philadelphia, Washington, 
 and San Francisco, where similar studies of the subject 
 have been made. 
 
 Mr. C. B. Fillibrown, of Boston, has made a most 
 careful study of this subject, and in a paper read before 
 the National Tax Association in Columbus, Ohio, in 
 1907, said: 
 
 "The following Boston estimate indicates the gigantic 
 proportions of the factor, ground rent, and its suflaciency 
 to meet all reasonable costs of government, economically 
 administered, not only without impoverishing the land- 
 owner, but without subjecting him at any time to a tax 
 more burdensome or more continuous than that borne by 
 every man that has lived in a house since a house tax 
 was invented. 
 
 The gross ground rent of the land of the city of Boston 
 
 is, by careful estimate, not less than S50,000,000 
 
 Of this amount there is already taken in taxation . . 10,000,000 
 Leaving to the land-owners of to-day a net ground 
 
 rent of $40,000,000 
 
 "The fact that this sum amounts to $68 per capita, 
 or $340 per family, will help the mind to grasp its magni- 
 tude as a factor in the distribution of wealth. 
 
 State and local taxation upon improvements, build- 
 ings, personal property, and polls amount to some- 
 thing over another $10,000,000 
 
 If this additional amount were taken from rent, there 
 would still remain to the land-owners a balance of . $30,000,000 
 — $51 per capita, or $255 per family." 
 
THE LAND VALUES TAX 309 
 
 How readily all of the revenues of the nation could 
 be met from rent in its various forms is seen from the 
 policy pursued by the government in its treatment of the 
 lands of the Indian tribes in Oklahoma, referred to else- 
 where. Minnesota has demonstrated the same thing in a 
 small way. That State was fortunate enough to retain 
 some of its school lands. Upon them iron ore was dis- 
 covered. There were but fifteen iron ore deposits in all, 
 but through the imposition of a royalty of twenty-five 
 cents a ton on the ore mined, the State has come into pos- 
 session of a fund of over $16,000,000. Had the Federal 
 Government pursued this policy from the beginning, as it 
 is now proposed by the President in his recent message 
 on conservation to Congress, all of the revenues of the 
 Federal Government could have been met by a royalty 
 charge of one-quarter of the value of the mineral output 
 of the country, which, according to the Geological Survey, 
 was worth the sum of $2,069,289,196 in 1907. Five hun- 
 dred millions of dollars could have been realized from 
 this source had the nation reserved but 25 per cent, of the 
 value of its mineral products alone. 
 
 In foreign countries the increase in land values and the 
 possibilities of their taxation for public purposes are being 
 urged. In an article entitled " Wohnungsnot," in Con- 
 rad's Jahrbucher for 1902, it is asserted that the land 
 underlying the city of Berlin increased in value in twenty 
 years, from 1870 to 1890, by the sum of $875,000,000, or 
 at the rate of $43,750,000 a year. Mr. Camille Huysmans, 
 in a publication entitled La Plus-Value Immobiliere dans 
 les Communes Beiges (Brussels), has gathered together 
 evidences of the increase in urban-land values in the 
 countries of Europe. He shows that in Germany, Eng- 
 land, France, Belgium, and elsewhere the increase is only 
 
310 APPENDIX II 
 
 less significant than in the United States. And in Ger- 
 many, this unearned increment is already being taxed by 
 most of the larger cities, while in Great Britain, Belgium, 
 and Switzerland measures are being pressed for the same 
 purpose. 
 
INDEX 
 
 Agricultural land, Increase in 
 
 value of, p. 131 
 Anthracite coal, Monopoly of, 
 
 p. 153 
 Astor estate, p. 124 
 
 B 
 
 Banking methods. Change in 
 character of, p. 59; monopoly 
 of credits, p. 62 
 
 Belgium, Land system and ten- 
 ancy in, p. 91 
 
 Bituminous coal. Monopoly in, 
 p. 50 
 
 Black Plague, p. 9; Effect of on 
 society, p. 279 
 
 C 
 
 City, Cost of land monopoly in, 
 p. 168 
 
 Civil War, Influence of public 
 lands on, p. 20; ascendancy 
 of privileged classes during, 
 p. 207 
 
 Civilization and decay, p. 239 
 
 Class legislation, p. 104; class 
 rule, p. 107 
 
 Coal, Monopoly in, pp. 46, 153 ; 
 land values in, p. 132; mo- 
 nopoly charges for, p. 167 
 
 Common ownership of land, p. 96 
 
 Community land. Village owner- 
 ship of, p. 98 
 
 Consolidation of wealth in 
 America, p. 57 
 
 Copper, Value of deposits of, 
 p. 53; land values in, p. 
 132 
 
 Cost of living. Increase in, p. 174 
 
 Costa of tenancy, p. 83 
 
 D 
 
 Dangers of railway monopoly, 
 p. 143 
 
 Decay, Civilization and, p. 239 
 
 Demand and supply. Law of, 
 p. 117 
 
 Democracy, Economic founda- 
 tions of, p. 18; influence of 
 West on, p. 21; effect of eco- 
 nomic opportunity on, p. 25; 
 due to communal land tenure 
 in early times, p. 97; era of, 
 p. 206; meaning of, p. 294; 
 of to-morrow, p. 294 
 
 Distribution of wealth, p. 185 
 
 E 
 
 Economic influence of land, p. 12 
 
 Economic interpretation of poli- 
 tics, Preface; p. 203 
 
 England (See Great Britain); 
 feudalism in, p. 8 
 
 Extravagance in government, 
 due to tariff, p. 221 
 
 Famine, Cause of, p. Ill 
 Federal Constitution, Venera- 
 tion for, p. 108 
 
 311 
 
312 
 
 INDEX 
 
 Feudalism, in England, p. 8; 
 
 source of, p. 95; completion 
 
 of, p. 99; essence of, p. 106 
 
 Feudal tenure, Distinguishing 
 
 feature of, p. 101; destruction 
 
 of, p. 102 
 
 Finance, New methods in, p. 58 
 
 Franchise corporations. Land 
 
 values in, pp. 133, 154 
 Fraudsonthepublicdomain,p. 39 
 Freedom, traceable to systems 
 of land tenure, p. 25; indus- 
 trial, p. 298. (See Liberty.) 
 
 G 
 
 Government, commercialized by 
 the Civil War, p. 211 
 
 Great Britain, Feudalism in, p. 
 8; village community in, p. 
 98; land monopoly in, p. 164; 
 cause and ejctent of poverty 
 in, p. 165; effect of land mo- 
 nopoly in, p. 192; free trade in, 
 p. 300 
 
 Ground rent, a feudal survival, 
 p. 148. (See Rent and Land.) 
 
 H 
 
 High finance, p. 58 
 Holland, Effects of system of 
 land tenure, p. 92 
 
 I 
 
 Indian tribes. Leasing of lands of 
 
 by government, p. 31 
 Indirect taxation, Origin of, p. 
 
 204; some of the costs of, p. 
 
 218; war due to, p. 222 
 Industrial consolidation, p. 64. 
 
 (See Monopoly.) 
 Industrial freedom, p. 298; effect 
 
 of, p. 301 
 Ireland, Effect of competitive 
 
 tenancy in, p. 88; John 
 
 Stuart Mill on, p. 120 
 
 Iron ore. Monopoly of, p. 51; 
 holdings of United States 
 Steel Corporation, p. 52 
 
 Insurance companies, p. 60 
 
 Labor problems. Inadequacy of 
 explanation of, p. 173 
 
 Land, Effect of system of tenure 
 in ancient Rome, p. 5; mo- 
 nopoly in England, p. 10; 
 economic influences of, p. 12; 
 cause of American Revolu- 
 tion, p. 19; influence of public 
 lands in America, p. 20; 
 wages, effect of free land on, 
 p. 23; extent of public lands 
 in America, p. 28; policy of 
 government in relation to, p. 
 31; land grants, p. 32; value 
 and extent of, p. 35; land 
 monopoly, extent of, p. 43; 
 monopoly of, p. 75; private 
 property in, p. 100; values of, 
 p. 116; in New York City, p. 
 124; elsewhere, p. 129; in the 
 United States, p 135; railway 
 problem a land problem, p. 
 138; policy in distribution of 
 public lands, p. 177; cause of 
 land values, p. 187; socializa- 
 tion of land values, how ac- 
 complished, p. 259. (See Land 
 Values, Monopoly, Single 
 Tax.) 
 
 Land grants to railways, p. 32; 
 corruption connected with, p. 
 35 
 
 Landlordism, Origin of, p. 102 
 
 Laveleye, on tenancy in Bel- 
 gium, p. 91 
 
 Law, Effect of on society, Pref- 
 ace; p. 203 
 
 Liberty, Meaning of industrial, 
 pp. 256, 295, 301 
 
 Loria, Achille, on class ascend- 
 ancy in politics. Preface; p. 3; 
 
INDEX 
 
 313 
 
 on wage conditions in new 
 countries, p. 178 
 
 M 
 
 Migrations of people, p. 4 
 
 Mill, John Stuart, pp. 88, 120 
 
 Mineral production in United 
 States, p. 154 
 
 Mineral resources, Disposal of, 
 p. 45; value and annual prod- 
 uct of, p. 54; extent of con- 
 trol of by monopoly, pp. 55, 
 166 
 
 Money monopoly, p. 59 
 
 Monopoly, see Land; extent of 
 land monopoly, p. 45; pe- 
 troleum, p. 47; other minerals, 
 pp. 46 to 53; money monopoly, 
 p. 59; Wall Street and mo- 
 nopoly, p. 60; cause of, p. 68; 
 railways, p. 143. (See Land 
 and Railways.) 
 
 Morals, Economic foundations 
 of, p. 243; made by the as- 
 cendant economic class, p. 244 
 
 N 
 
 Natural gas, p. 49 
 
 Negro slavery, p. 109 
 
 New York City, Land values in, 
 p. 126; means for the social- 
 ization of, p. 260; burden of 
 rent in, p. 151 
 
 O 
 
 Oklahoma, Value of lands in, 
 
 p. 130 
 Overproduction impossible, p. 
 
 119 
 
 Pacific railways. Land grants to, 
 p. 33; corruption and frauds 
 connected with, p. 35 
 
 Petroleum, Monopoly in, p. 47 
 
 Politics, Merger of with privilege, 
 p. 213; class control of in all 
 countries. Preface; in America 
 p. 215; some of the costs of, 
 p. 229 
 
 Population, Effect of on land 
 values, p. 114; density of, p. 
 160 
 
 Poverty, Cause of, p. 119; in 
 Ireland, p. 120; causes usually 
 assigned, p. 157; an over- 
 looked cause of, p. 229; costs 
 of, p. 238 
 
 Private property in land, p. 100 
 
 Privilege, Motive of, p. 231; cost 
 of, p. 235; control of press by, 
 p. 250 
 
 Production, Mineral, in America, 
 p. 154 
 
 Prosperity, progress of produc- 
 tion, p. 118; in new countries 
 due to land, p. 195 
 
 Protective tariff. Origin of, p. 
 204; a war product, p. 207; 
 some of the costs of, p. 218; 
 effect of abolition of, p. 287 
 
 Public lands, see Land; influence 
 on in America, p. 20; extent 
 of, p. 28; relation of govern- 
 ment to, p. 31 
 
 Public Lands Commission, Re- 
 port of, p. 86 
 
 Public domain. Extravagance io 
 its disposition, p. 177 
 
 R 
 
 Railways, see Monopoly and 
 Land; land grants to, p. 32; 
 corruption connected with, p. 
 35; consolidation of, p. 55; 
 increase in rates on, p. 56; 
 values of, 133; railway prob- 
 lem, a land problem, p. 138; 
 monopoly of, p. 143; relation 
 of Pacific railways with Con- 
 gress, p. 210; connection with 
 politics and increase in capital- 
 
314 
 
 INDEX 
 
 ization and earnings, p. 225; 
 extent of tax evasions, p. 227; 
 necessity of public ownership 
 of, p. 289 
 
 Rent, see Land and Single Tax; 
 origin of competitive, p. 102; 
 increase of, p. 119; a feudal 
 survival, p. 148; a burden on 
 labor, p. 150; not limited to 
 land alone, p. 152; total in 
 United States, p. 156; opin- 
 ions of economists on, p. 189; 
 taxation of, p. 258; effect of 
 taxation on, p. 271; amount 
 of in America, p. 307; in the 
 larger cities, p. 308 
 
 Resources of America, p. 29; 
 disposal of, p. 45 
 
 Revenues of Federal Govern- 
 ment, p. 217 
 
 Revolution, American, causes of, 
 p. 19 
 
 Roman law, basis of land tenure, 
 p. 94; source of feudal system, 
 p. 95 
 
 Rome, see Land Monopoly; evo- 
 lution of, p. 4; land monopoly 
 in, p. 6; Roman law, basis of 
 land monopoly, p. 94 
 
 S 
 
 Scotland, Land monopoly in, p. 
 
 164 
 Serfdom, Evolution of, p. 94 
 Servitude, Explanation of , p. 121 
 Settlement of America, p. 12 
 Single tax. Meaning of, p. 257 
 et seq.; justice of, p. 264; as 
 a social philosophy, p. 264; ef- 
 fect on distribution of wealth, 
 p. 276; on industry and wages, 
 p. 277; on wages, p. 281; suf- 
 ficiency of in United States, 
 p. 306; movement for in otheir 
 countries, p. 309 
 Speculation, Effect of land values 
 tax on, p. 267 
 
 Standard Oil Company, Extent 
 
 of holdings of, p. 48 
 Supply and demand. Law of, p. 
 
 143 
 
 Tariff, Evolution of, p. 204; a 
 war product, p. 207; some of 
 the costs of, p. 218; wars due 
 to, p. 222 
 
 Tax evasions, p. 227 
 
 Taxation. (See Indirect Taxa- 
 tion and Tariff.) 
 
 Tenancy, Extent of in United 
 States, p. 71 et seq.; effect of, 
 p. 76 et seq.; in Ireland, p. 88; 
 in Belgium, p. 91; origin of, 
 p. 102 et seq. 
 
 Tenement conditions in New 
 York, p. 150 
 
 U 
 
 Unearned increment, p. 122 
 United States Steel Corporation, 
 
 p. 52; value of land holdings, 
 
 p. 153 
 
 Values, Land, p. 116. (See 
 
 Land.) 
 Veneration for old ideas, p. 107 
 Village community, p. 98 
 
 W 
 
 Wages, Effect of free land on, p. 
 23, movement of in United 
 States, p. 174; what deter- 
 mines, p. 181; effect of mo- 
 nopoly on, p. 181; strikes and 
 labor wars, p. 182; iron law 
 of, p. 199; average of in 
 United States, p. 235; effect 
 of single tax on, p. 277; Black 
 Plague and, p. 279 
 
INDEX 
 
 315 
 
 Wall Street, Extent of control 
 
 of, pp. 55, 60; Identified with 
 
 politics, p. 209 
 Wallace, Alfred Russel, on land 
 
 monopoly in Scotland, p. 
 
 164 
 
 War, traceable to indirect taxa- 
 tion, p. 222 
 
 Wealth, Consolidation of, p. 57; 
 distribution of, p. 185; produc- 
 tion of in America, pp. 185, 233 
 
 West, Enclosure of, p. 16 
 
BOOKS BY FREDERIC C. HOWE 
 
 The British City 
 
 The Beginnings of Democracy 
 
 12tno. $1.50 net 
 
 CONTENTS 
 
 Introductory. 
 
 Glasgow— A City of Things 
 and Conscience. 
 
 The Beginnings of Democracy. 
 
 The Town Council. 
 
 London: A Municipal Democ- 
 
 The Citizen and the City. 
 The Ideals of the British City. 
 
 racy. 
 
 The American and the British 
 
 The Growth and Extent of 
 
 City; A Comparison. 
 
 Municipal Trading. 
 
 The Dead Hand of the Land. 
 
 The Cities and the Tramways. 
 
 The British Parliament— The 
 
 The Gas Supply. 
 
 Sanctuary of Privilege. 
 
 The Electricity Supply. 
 The Greatest Gain of All. 
 
 The Upper and Nether Mill- 
 
 stones of Privilege. 
 The Next Step of Industrial 
 
 The Municipality and Labour. 
 
 Parliament and the Cities: The 
 
 Democracy. 
 The City of To-morrow. 
 
 Tyranny of a Class. 
 
 Index. 1 
 
 "The author views the history of municipal 
 government in England, describes its structure and 
 form. . . . His position is unquestionably sound, and 
 he reflects the spirit of the age and the dominant 
 tendencies and ideas. He has written a vital and 
 significant book." — Chicago Post. 
 
 "A valuable contribution to a branch of political 
 science of the foremost present importance." 
 
 — Philadelphia Press. 
 
 "There are few persons interested in municipal 
 questions who will not find it of value." 
 
 — The Nation. 
 
BOOKS BY FREDERIC C. HOWE 
 
 PUBLISHED BY 
 
 CHARLES SCRIBNER'S SONS 
 
 
 The City 
 
 The Hope of Democracy 
 
 12tno. $1.50 net. 
 
 
 
 CONTENTS. 
 
 Introductory The City Republic. 
 Tlie New Civilieation. The City Charter. 
 The Profit Account. The Coat of the Slum. 
 The Loss Account. The City's Homes. 
 The American City at Work. The City's Wreckage. 
 The Source of Corruption. The Wards of the City. 
 The Boss, the Party, and the The City Beautiful. 
 
 System. The City's Treasure. 
 The Way Out — Municipal The Revenues of the City. 
 
 Ownership. The City for the People. 
 Does Municipal Ownership The Hope of Democracy. 
 
 Pay? 
 
 Index. 
 
 
 
 " In his analysis of the present political and municipal 
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 " Every chapter is interesting. ' The City ' merits a wide 
 reading and is calculated to do a most useful service." 
 
 — Hon. Lucius F. C. Garvin. 
 
 "A frank discussion of municipal problems as they are 
 actually encountered in the more typical of our American 
 cities. The prevailing note is one of optimism." 
 
 — Review of Reviews.